By Elizabeth Broomhall
UAE emirate sees tourism accounting for 20% of economy in move away from industry
Ras Al Khaimah will plough $100m into hotel and tourism projects over the next four years in a bid to quadruple its visitor count, the COO of its tourism authority said Wednesday.
The northern emirate, whose GDP comprises 1.5 percent of the UAE’s economy, hopes to see tourism revenues account for 20 percent of its income by 2021, by positioning itself as a lower-cost destination to its glitzy neighbour, Dubai.
“[Ras Al Khaimah] is one of the few destinations in the UAE and the Middle East which provides value for money,” said Victor Louis, the COO of RAK Hotel and Tourism Development Authority.
The emirate, whose sovereign wealth fund has a portfolio of around $2bn, launched the authority to attract foreign investment and manage state-funded tourism projects.
“It does not have the high-end prices as in Dubai, but you can still find quality hotels and restaurants and you’re just 45 minutes from Dubai. RAK is also one of the few areas that still has beach areas available for development,” he said.
Ras Al Khaimah sits on the Strait of Hormuz, through which 40 percent of the world's seaborne oil passes. The emirate has little oil wealth and its economy is built on industries such as cement, pharmaceuticals, and glass, which it is keen to diversify from.
RAK relaunched its flag carrier in October with tickets priced as low as AED10 in a bid to ramp up tourism numbers in the emirate. The carrier, which suspended operations in May 2009 due to tough economic conditions, has targeted the budget, short-haul market with routes to India, Saudi Arabia and Egypt.
Projects due to come online this year in the emirate include the Waldorf Astoria hotel – the luxury brand’s first UAE property – and two new shopping malls, the Ras Al Khaimah Mall and the Al Naim mall.
The man-made Marjan Island remains under construction, but is likely to play host to a number of branded hotels and resorts on completion, Louis said.
“At the moment we’re putting together a 10-year plan, which includes looking at how many hotel rooms we need, so as not to oversupply the market, and how many will be beach hotels.”
Louis said the government would also be investing in residential developments.
“As much as global source-markets are important, we cannot forget about the huge potential of the UAE market, where people like to go away for short weekends or for public holidays.”