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Fri 25 Mar 2011 12:15 PM

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Oman economy seen growing by 2.4% in 2011

Business Monitor Int'l says economy will be weaker this year after oil production peaked in 2010

Oman economy seen growing by 2.4% in 2011
Recent protests in Oman. (Getty Images)

Oman's economy is predicted to weaken this year after oil production peaked in 2010, Business Monitor International said in a new report.

BMI analysts believe real gross domestic product growth will fall to 2.4 percent in 2011, down from 3.6 percent last year, but they expect growth to increase again next year.

The report added: "Oman’s economic growth remains weaker than it has been in the past. We have revised our forecasts down slightly from last quarter.

"This is due to a downgrading of our oil output forecasts, and despite ongoing investment in the sector, we believe that 2010 marks the peak of Omani oil production."

BMI stressed that the prediction of lower real GDP for 2011 was based entirely on oil forecasts and not any weakness in the non-oil sector.

The report added that Oman’s growing population - with an estimated 40 percent under 15 years of age - was "putting pressure on the economy, demanding the creation of new employment for the growing number of available workers".

BMI said Oman's tourism - based on emphasising the country's natural beauty - was working with the World Travel & Tourism Council (WTTC) expecting the industry to grow from 1.5 percent of total GDP in 2010 to 2.4 percent of GDP by 2020.

"There are hotel, resort and conference venues being built and refurbished and the market has recovered from the setback of the global financial crisis," BMI's report added.

Formula 1 racing driver Mark Webber recently said in an interview that Oman was his “favourite holiday destination".