Asymmetric impacts of global competitiveness and foreign direct investment on green total factor productivity in Oman

Abstract Achieving sustainable economic growth in resource-dependent economies is vital to balancing competitiveness, attracting investment, and improving environmental performance. This study examines the asymmetric effects of global competitiveness and foreign direct investment (FDI) on green total factor productivity (GTFP) in Oman, within the frameworks of endogenous growth theory and the porter hypothesis. Using annual data from 1990 to 2024, time-series forecasting methods such as ARIMA, SARIMA, and Prophet models, which respectively capture linear, seasonal, and non-linear asymmetric patterns in productivity dynamics. Results show that positive shocks to competitiveness lead to a larger and more sustained increase in GTFP compared to negative shocks, while FDI exhibits a pollution halo effect when directed towards green sectors but can cause environmental costs when focused on carbon-intensive industries. CO2 emissions and energy intensity are found to significantly reduce GTFP, indicating the need for stronger decarbonisation and efficiency measures. The study contributes to sustainability theory by demonstrating how asymmetric and non-linear productivity responses emerge from policy and investment interactions in a transitioning economy. Policy recommendations emphasise integrating competitiveness reforms with targeted green FDI incentives, institutional strengthening, and renewable energy investment to support Oman’s Vision 2040 and Net-Zero 2050 objectives. By integrating asymmetric modelling with predictive analytics, this study provides actionable insights for GCC policymakers seeking to accelerate the transition to low-carbon, innovation-driven economies.