Muscat Governorate
Muscat's 1.72M residents generate the bulk of Oman's RO 38.3B GDP (2024)—the capital governorate where petroleum, trade, and Vision 2040 diversification concentrate as non-oil activities grew 3.9%.
Muscat exists because the Gulf of Oman's coastline created natural harbors where the Hajar Mountains meet the sea—the protected waters of what is now the capital have anchored trade between Arabia and the Indian Ocean world since at least the 1st century CE. The city's maritime power once extended to Zanzibar and East Africa; today it concentrates Oman's economic and political life across six wilayats spanning 6,500 km².
The governorate's 1.72 million residents (2022) generate disproportionate national output: petroleum, LNG, and trade dominate, while the service sector expands under Vision 2040 diversification. Oman's real GDP reached RO 38.3 billion in 2024 (up 1.7%), with non-oil activities growing 3.9% to RO 27.9 billion. The 2025 budget projects $102.3 billion GDP. Much of this activity concentrates in greater Muscat.
Port Sultan Qaboos and the Muttrah corniche preserve the commercial tradition that made Muscat synonymous with Omani trade. The Muttrah Cable Car project—combining heritage and modernity—aims to enhance urban identity while attracting tourists. SME contracts reached 114.5% of targets in 2024, totaling RO 65.4 million, signaling economic activity beyond petroleum.
Oman becomes the first Gulf country to impose personal income tax in 2028—5% on individuals earning over RO 42,000 annually—reflecting the fiscal modernization centered on Muscat's administrative apparatus. The sultanate recorded a $1.4 billion fiscal surplus in 2024 at $82/barrel oil prices.
By 2026, Muscat's trajectory depends on whether non-oil diversification can reduce capital city dependence on hydrocarbon revenues while service sector expansion creates sustainable employment.