Stunningly situated at the southern tip of the Arabian Peninsula, this erstwhile seafaring country long ago discovered trade routes to the Far East and Africa. Persians, Indians, Arabians and Portuguese all landed here. It is said that Omanis even clued Portuguese explorer Vasco da Gama into the routes, a tip that eventually led to his voyage to the New World. Today, Oman is taking advantage of its plum location and turning to trade and tourism. But unlike its splashier neighbors who are growing at lightning speed, the Sultanate of Oman is being more deliberate in finding the right balance between the ancient and the new.

About the size of Nevada, Oman became independent in the 17th century, when the Portuguese departed. Modern Oman, however, began in 1970 when Sultan Qaboos bin Said overthrew his father as ruler. At the time the country had four miles of paved roads, and outsiders were hardly welcome. Since then, oil revenues have led to a new infrastructure that includes roads, electricity and water in even the most remote villages. Qaboos’ reign has been characterized by political stability and the slow transformation of Oman into an emerging, world-class economy that depends increasingly upon diversification. Yet, as Oman grows, it takes steps to protect the invaluable environment.Buildings can be no higher than nine stories, for instance, and they mostly adhere to traditional Islamic architectural style, which serves as a constant reminder that you are in Oman and nowhere else.

Much of Oman’s diversification is driven by a dwindling oil supply, which probably won’t last more than two decades. First discovered in the 1960s, oil was never as plentiful here as in its Gulf neighbors’ sands. New technology is being used to reach previously inaccessible reserves. The recent discovery of natural gas represents another major source of potential revenue. Mining, once an important industry, was ignored after oil was discovered but is now being revived. Construction and service industries also are growing due to substantial real estate and tourism investments, and the 2006 U.S.-Oman Free Trade Agreement is paving the way for more Western investment. U.S. exports include machinery, motor vehicles and plastics. Imports are mostly minerals, iron and steel, pearls and precious stones. Still, petroleum refining and natural gas account for the major income in Oman, with supplementation from chemicals, mineral products and food processing.

With 600 miles of coastline, Oman can capitalize on trade and tourism as it moves away from oil and develops major industrial and transportation ports. At the southern tip of the country, Salalah is becoming a major container port and industrial zone; with its natural deep water, it is the only port between Europe and Singapore capable of handling the largest container ships. A free zone enables investors to obtain licenses, visas and other tax advantages. In the north, a new port and industrial zone is taking shape at Sohar, which is closer to Dubai than Oman’s capital, Muscat.

An opening economy is luring foreign investors with such incentives as a corporate income tax that ranks among the lowest in the region, privatization programs and improved telecommunications. Oman’s Foreign Capital Investment Law allows 70 percent foreign investment in local industries and 100 percent ownership for projects of importance to the government. Foreigners are allowed to buy real estate outright rather than through long-term leases, albeit in designated areas. My guide, Mohammad, assured me that Oman is safe for business and pleasure, noting that terrorists would find it difficult to take root since the poor are buoyed up by the government.

Oman’s gorgeous, unspoiled beaches remain a largely untapped gold mine for tourism, which grew by 16 percent in 2006 with an emphasis on luxury travel. Oman’s largest and most luxurious getaway, the Shangri- La’s Barr Al Jissah Resort and Spa, opened in 2006 and is p
utting Oman on the map as the next must-visit country.

Several other major hotel projects are under development. Most noteworthy is The Wave, an $820 million luxury residential and hotel complex scheduled to open in 2010 on prime beachfront overlooking the Gulf of Oman and conveniently located near the country’s international airport. In addition to containing four hotels, one of which will be managed by Fairmont Hotels and Resorts, the mega-facility will feature a marina and a world-class Greg Norman golf course — the country’s first real golf facility.

Another significant investment, Blue City in Al Sawadi, is about 90 miles north of Muscat. When completed, this $15 billion property will be the largest mixed residential and tourism development in the Gulf region, literally a new city that will include 16 hotels and a population of 250,000. Dubai International Properties is expected to invest more than $800 million for yet another tourist and residential development at Yiti, on the coast south of Muscat. This development will include three hotels, villas, a golf course and canals leading to the nearby mountains. In the north, the Six Senses Hideaway Zighy Bay is the first upscale resort set among the mountains and fjords of the Musandam Penninsula. Predictably, cruise ships are discovering Oman as well. The luxury cruise line Silver Seas is anchoring at three ports to take advantage of the stunning coastal scenery and exotic culture, with stops at Salalah, Khasab and Muscat.

Despite these massive developments, some of which remain in the early stages, Oman is carefully cultivating a reputation for selective, high-end tourism rather than package tours. Even with its developing ports, industrial areas and tourist opportunities, Oman is avoiding development that mirrors its booming neighbor, Dubai. (Oman’s gross domestic product is growing about 6 percent annually.) Looking ahead, investments in tourism and construction, along with a burgeoning real estate market, should fuel the economy and create jobs for Omanis — including women, who are allowed to drive, work if they choose and even serve in government. Oman is spending more than $3 billion to expand its international airport in Muscat and will soon have three new domestic airports. And in a public relations coup, the Sultanate was named one of the world’s top 20 economically free countries — though Omanis still have the “right of the soil,” legal land rights over foreigners.

LODGING

AL BUSTAN PALACE INTERCONTINENTAL
Long the hotel of choice for visiting dignitaries, this palatial Islamic-style property was built as the Sultan’s guesthouse. It has just reopened after extensive multimillion- dollar renovations. Set beneath craggy mountains on 200 beachfront acres, the hotel has 250 guestrooms and 40 suites, many with water views. About two miles outside of Muscat and 40 minutes from the airport, the hotel provides guests with complimentary shuttle service within about nine miles of the property.$$$$
AL BUSTAN PALACE INTERCONTINENTAL
P.O. Box 1998, Muttrah
tel 968 24 799 666
www.intercontinental.com

SHANGRI-LA’S BARR AL JISSAH RESORT & SPA
Situated on the Gulf of Oman where the rocky mountains meet the coast, this stunning property brings a new level of luxury and sophistication to Oman. Comprised of three separate hotels spread over 124 acres, all just steps from the beach, the resort was inspired by traditional Omani buildings. At Al Husn, an exclusive retreat with 180 guestrooms, guests have their own private beach and bars — as well as a butler to unpack their bags. Al Bandar offers 198 guestrooms; Al Waha, the largest with 262 guestrooms, is geared more to families. The elegant Chi spa offers treatments which incorporate the healing properties of locally grown frankincense. A marina offers diving and fishing charters as well as whale-watching in season.$$$$
SHANGRI-LA’S BARR AL JISSAH RESORT & SPA
Barr al Jissah
tel 968 24 776 666
www.shangri-la.com/muscat

THE CHEDI, MUSCAT
A stylish favorite among discerning travelers, the hotel is designed in traditional Omani architecture and located on the beach in the Al Ghubrah area, home to most of the embassies and just 15 minutes from the airport. The 151 wellappointed guestrooms and suites have views of the surrounding mountains or lush gardens, with access to a private beach and spa facilities. Club rooms and suites offer use of The Library for breakfast and cocktails. The Chedi’s restaurant and bar are popular with locals.$$$$
THE CHEDI, MUSCAT
North Ghubrah 232
tel 968 24 524 400
www.chedimuscat.com

DINING

SEBLAT AL BUSTAN
The setting is an outdoor Bedoin village with local music and handicrafts, along with top-notch food, at the Al Bustan Palace InterContinental Hotel. This is the place to experience authentic Omani cooking. Specialties range from fish to meats and stews seasoned with Indian and African spices.$$$
SEBLAT AL BUSTAN
Al Bustan Palace InterContinental Muscat
tel 968 24 799 666.

SHAHRAZAD
The Moroccan food served in this elegant setting is superb. Dishes include pastilla bil haman, a pie served at Moroccan weddings; Marrakech’s mezzeh salads; and the famed, delicately seasoned braised lamb dish, tanjia Marrakeshia. All are savory, as is the delicious seafood couscous and tajine from the coastal city of Essouira. The restaurant is open for dinner only.$$$
SHAHRAZAD
Al Husn Hotel at Shangri-La’s Barr Al Jissah Resort
tel 968 24 776 565

THE RESTAURANT
Adjacent to the lobby at The Chedi, Muscat, The Restaurant is a favorite among Omanis. The informal yet elegant setting is highlighted by an open kitchen that features four menus — Arabian, Italian, Asian and Indian. There are beach views, indoor seating and outdoor seating in the gardens.$$$
THE RESTAURANT
North Ghubrah 232
tel 968 24 524 400
www.shangri-la.com/muscat

Checking In with Kent Cooper
Regional Director of Sales and Marketing, Middle East and Africa, Fairmont Hotels & Resorts

Global Traveler: Why did Fairmont decide to open in Oman?

Kent Cooper: It is an opportunity to reinforce brand awareness in the region. Since its origins 100 years ago, Fairmont has been synonymous with storied, iconic hotels such as the Fairmont San Francisco and more recently The Savoy in London. But the brand has had a presence in the Middle East and North Africa for less than six years, beginning with the company’s first international flagship, The Fairmont Dubai. As a global luxury hotel leader, our regional growth efforts are focused on gateway cities throughout the Middle East and North Africa. Currently, we have 15 projects in various stages of development and design, and anticipate doubling this number in the next five years. The Wave project in Muscat represents a key project in our development strategy.

GT: Is working in Oman different from working in other countries in the region? If so, in what ways?

KC: As a company, we see our role as being a focal part of the community through our social activities and platforms as well as bolstering the destination and region through our sales and marketing efforts. Our properties often become landmarks, evolving with the destinations. Our colleagues serve as ambassadors, not only to the brand but also the location. Oman has a strong and vibrant nationalization program which calls for 75 percent of all hotel staff to be local hires. When combined with our focus on community and offering our guests an authentically local experience, this becomes a perfect example of synergy between company and community.

GT: How do you see Oman changing over the next five years?

KC: Oman is witnessing double-digit growth in tourism, driven by its natural resources and offerings as well as the Sultanate’s support of mega-developments and mixed-use projects, such as The Wave location of Fairmont’s first resort in Oman.

DIVERSIONS

Muscat alone is a fascinating trip back in time. The twin forts of Jalali and Merani, built by the Portuguese in the 16th century, overlook this port city in which even new buildings look patently Islamic. The authentic Muttrah Souk is usually bursting with an interesting array of Omani jewelry, Bedouin handicrafts, fragrant spices and Omanis doing their everyday shopping. Muscat also has a thriving fish market, where the dazzling array of fresh fish includes some netted from coral reefs near the shore. The modern Sultan Qaboos Grand Mosque accommodates 20,000 worshippers and is the only mosque open to non-Muslims (mornings except on Thursdays and Fridays). Inside, you can’t miss the famed Persian carpet, which took 600 women four years to weave.

Outside of Muscat, you can explore the desert, the coast and mountains that hold old villages, forts and wadis. Or you can simply hit the water and sail along the coastline. There is snorkeling, game angling and first-class diving — Oman remains one of the best-kept secrets of the diving world.

Sightseeing highlights include Birkat al Mawz, a famed fortress with its well-preserved falaj (stone irrigation system); Jebel Shams, the country’s highest mountain, known as Mountain of the Sun (Oman’s Grand Canyon); and Wadi Ghul, the rug-making village. Wadi Bani Awf is a famed historical route through the Hajar Mountains. The ancient city of Nizwa, once the country’s capital, is today an oasis city known for its lush palms, Bahla Fort (a UNESCO Heritage site) and fine pottery. Go on Friday to shop at the colorful souk.

Desert Discoveries (tel 968
24 493 232, www.desertdiscovery.com) offers overnight tours to Turtle Beach at Ras al Jinz and Wahiba Sands, known for its red dunes that feature Bedouin tents and dining on Arabian specialties. Muscat Diving and Adventure Center (tel 968 24 485 663, www.omandiving.com) specializes in scuba diving, trekking and trips to Majlis al Jinn, a 50-story cavern.

INFO TO GO

Most visitors arrive at Muscat International Airport (MCT) from Dubai International Airport (DXB), a 45-minute flight. Getting to your hotel will take 20-30 minutes by taxi. As taxis are not metered, it is best to pay in advance at the airport or negotiate in advance with the driver. New high-speed ferries offer service along the Musandam Peninsula between Khasab and the northern coast. For information, visit www.omantourism.gov.om.