Can Oman succeed in tourism?

As the rest of the Gulf sweltered in the punishing summer heat, Salalah, the quirky capital of Omans southern Dhofar region, bathed in the cool rain of the monsoon between June and September.

While temperatures surge past 50¡ C in many Gulf Cooperation Council (GCC) countries, the mercury in Salalah hovers around a comfortable 25¡ C. As a result, Oman sees Salalah as a key component in developing its tourism industry. Yet many see obstacles looming here and elsewhere in the country Ð despite the raw potential of this historic land.

The Muscat government says that it is now aiming to raise the sectors contribution to the national GDP to three percent by 2020, up from the current 0.3 percent. That 10-fold increase would raise tourism revenues to 130 million rials ($333 million). By regional standards, of course, that's just a drop in the bucket: consider that Dubai took in $380 million last year from airport duty-free sales alone.

Indeed, ask anyone in the industry about tourism in Oman, and talk inevitable turns to the UAE. And there are a number of very good reasons for making the comparison.

In 2002, Oman attracted some 1.2 million foreign visitors; about 700,000 came from the GCC states. And of those 700,000 tourists, a staggering 85 percent of them came from the UAE. For all the talk in Muscat and Salalah about bringing in European tourists, the fact remains that the bulk of the sultanates visitors come from a lot closer to home - and, of those, huge numbers are simply driving across the border for a very short-term stay.

But is that a sign of the industry's weakness or its potential strength? According to many industry professionals, the only logical route for any serious expansion of Omans tourism sector is by touting it as a short hop from Dubai. In that case, the contrast between honkytonk Dubai and the sleepy, slow-moving sultanate could easily become a selling point.

Oman has so much more to offer than the other Gulf states in terms of culture and history, says Lore Koening, director of sales and marketing at the Chedi Muscat, a year-old luxury destination. Oman does'nt have to resort to newly built versions of the olden days. It can offer visitors the real thing. Koeing makes a good point.

Oman offers an authentic Arabian experience that's not easily available elsewhere in the region. But here's where things get complicated: in its drive to promote tourism, the government has given the green light to vastly ambitious projects like The Wave, an $837 million resort just west of the capital.

Its clear that billion-dollar tourism projects are going to inevitably detract from the authenticity of the Omani experience. So what's the right balance? Muscat models. The Chedi Muscat is probably a good place to start. The hotel is relatively small Ð with just 151 rooms Ð and also relatively pricey Ð with rates ranging from $195-480 per night.

What makes the Chedi a possible model for Oman is not just size, though. Its also a matter of style Its a very Omani-based design, points out Koening. Its very symmetric and very open. The hotels elegant styling does'nt hurt, either, and its modernist lines are clearly going to appeal to upscale tourists Ð if and when they ever hear about the hotel or, for that matter, the country.

Recently, the sultanates newly formed tourism ministry appointed Dubai-based Fusion marketing to boost the country's image and, last year, the Muscat government allocated $30 million to internationally marketing the country through 2005.

All that should help Ð and help is definitely needed, despite the good PR generated by new properties like the Chedi Muscat and upcoming resorts like the $170 million Barr Al Jissah and the $308 million Al Sawadi Resort. The tourism push is coming now in Oman because the clock is ticking: the country currently has just over 17 years of oil production left until its reserves are depleted.

Something is going to have to replace oil, and international tourism is'nt a bad place to start - even if it will never be the solution. In the meantime, growing regional tourism is the right strategy for the country. GCC residents have long flocked to the southern Dhofar region to escape the heat, and recent years have seen new efforts to encourage even more visitors.

At the heart of these efforts to promote summer vacationers in Salalah is the Khareef Festival - an international exhibition that features music, cultural programs, arts exhibitions, sport and local crafts. Festivals in Oman have gained momentum in the past few years, and have now become a cornerstone of the country's tourism industry.

Spearheading Oman's ambitions is the newly created ministry of tourism, set up to oversee the growth of the industry from its current 0.9 percent of GDP to a targeted three percent by 2020.

While all governmental tourist initiatives previously operated under the the ministry of commerce and industry, now tourism will receive full-time consideration Ð and a bigger budget. Add to that the fact that the new minister is a woman, and tourists will be welcomed by a fresh, progressive face.

Yet while many agree that the southern region may provide the country's best natural gifts for attracting tourists, shortcomings such as poor infrastructure, limited promotional exposure and too much bureaucracy may confound efforts to promote Salalah as a worldwide tourist destination.

Countrywide, the appropriate infrastructure to support tourism becomes a problem outside Muscat. Visitors look for support services, and Salalah is short on frills. There are few restaurants outside the hotels and even fewer activities besides taking in the natural beauty of the place. While this is ideal for many looking to escape built-up resorts and plastic seafront, the lack of activities is going to limit the number of people willing to come.

As Nabeel Jawad Sultan, director of Jawad Sultan Enterprises, a holding company with a leading tourism division, points out, Salalah is a beautiful place, but there is nothing there Ð no infrastructure. While bringing tourists to the region is great, the important thing is that they have ample things to spend money on - and at the moment Salalah comes up short.

Tours do operate in Salalah and encourage visitors to spend money, but even the hotels are having trouble selling their tour packages. Most people grab a map and rent a car, says Pauline Berg, director of sales and marketing at the Crowne Plaza. For tours, people need to book in advance, and most would rather do without this hassle.

European markets are being targeted Ð but not for the summer months. While Europeans hardly think a rainy, cool summer is anything to fly thousands of kilometers for, they do think that warm weather, beaches and sunshine in the winter is attractive. But if Salalah wants to start cornering the sun, sea and sand market, experts say that it must put more facilities in place to occupy people once they get there.

Good volume for 45 days is not enough to make profits, Samer Mashour, sales manager of the Hilton in Salalah said. We need to strive to make Salalah a 12-month destination, not just a summer getaway. Part of the solution appears to lie in a more concerted promotional campaign. We have instituted a host of services designed to increase the visibility of our hotel, such as online bookings, package deals, international sales offices and cooperation with European tourist agencies, Berg said.

But the government has to do more to assist the process. The government has also given signals that it intends to step up its efforts. The new ministry of tourism sponsored an ambitious census of traveler's to the Dhofar region this summer. By doing so they are identifying weekly numbers of travelers and sorting them by nationality.

The hope is that these statistics will provide promotional bodies with more specific data on the types of traveler's that come to Salalah in the summer. According to Sabir bin Said al-Harbi, director general of economic statistics at the ministry of national economy, there have been 62,838 visitors to Salalah since the Khareef Festival started on July 15th over 88 percent of them from GCC states.

Yet despite all these efforts, many say that the biggest single hindrance to realizing the full otential of tourism in the region is still the bureaucratic process. Decisions need to be filtered through a wide number of industries and organizations Ð ministries of tourism, information, commerce and industry, national economy along with the Royal Omani Police, aviation and immigration.

There has been progress in this area, but there is still work to be done. As with many sectors of the Omani economy, the building blocks for a successful industry are in place. Salalah has the natural beauty to become a world-class tourist destination.

But great foundations will get you nowhere without setting ambitious goals. The Khareef Festival in Salalah surpassed the 155,000 visitors that it got last year, and the overall summer numbers for the Dhofar region were also up by as much as 35 percent. But, as Jawad Sultan says, Oman has got to stop measuring itself by the progress it made the previous year. Its time for the sultanate to set a new standard for itself.