Economic Update

Published 22 Jul 2010

It may have just been one line in a much larger report on the state of the property sector of the UAE, but a single sentence in a recent press release by real estate firm CB Richard Ellis encapsulated one of the main focuses for the direction of tourism in Ras Al Khaimah (RAK).

Though talking about the emirate’s attractiveness as a second-home location for local and international investors, CB Richard Ellis also had this to say: “RAK has naturally occurring characteristics in the form of mountains and sea that provide some potential for tourism and leisure-based projects in the future.”

RAK officials and representatives of the tourism industry might disagree with one phrase in the above statement, that being “in the future”. As far as RAK is concerned, the future of tourism and leisure based-projects, especially those focusing on eco-tourism, is now.

Over the past few years, there have been increasing efforts to promote RAK as an outdoor tourism destination. While continuing to develop top-end tourist projects, especially along the coastal strip, RAK has been at pains to stress its credentials as an adventure and eco-tourism destination.

Along with the water-sports activities associated with resort holidaying, RAK also offers mountain climbing, trekking and bike tours, as well as four-wheel drive safaris and camping in either the hills or the desert dunes.

A far cry from the theme parks springing up across the Gulf, RAK hopes that its back-to-nature approach will appeal to those seeking a more authentic taste of Arabia.

Apart from trying to create a niche market, such off-the-beaten track holidays bring with them the added advantage of requiring local guides and experts, further boosting employment in the more remote regions of the emirate.

While having potential RAK also has rivals in adventure and eco-tourism in the Gulf region Oman in particular is promoting itself as an alternative holiday destination. Whilst RAK might not be able to challenge Oman in the scale and the breadth of its offering, it can use its compactness as a draw, promoting the very fact that sand and surf, along with its increasing array of five-star hotels and resorts, are so close to mountains, cliffs and exotic hinterland wildlife.

RAK has set itself the ambitious target of increasing tourist arrivals from the estimated 215,000 in 2008 to 2.5m by 2012. Furthermore, the emirate hopes to treble its number of hotel rooms by adding a further 3700 rooms to its books, with an estimated $5bn worth of new projects either under way or on the drawing boards.

Most of the planned new developments are along RAK’s coastal strip, though the close proximity of the inland wilderness, combined with its easy access by road, means that a hard day’s adventure can be followed by an evening of luxury.

Policymakers are understandably keen to strike a balance between achieving its potential and preserving its natural assets – the very attractions that give the emirate its distinct appeal.

This will not be allowed to happen, according to Hillary McCormack, the manager of the state tourism authority RAK Tourism, with development being carried out at a measured pace to ensure the heritage and culture of the emirate is preserved.

“The government first evaluates every developer’s product and, when necessary, guides them to assure the sustainability and success of the projects,” McCormack said in a recent interview with OBG. “The authorities keep a close look on development, as we want to make sure we preserve the environment.”

Though the natural environment may be protected, the business environment has become more of an issue.

While officials are sticking to their predictions of a massively increased tourist footfall by 2012, the global financial crisis has had an affect on RAK’s tourism industry and its ambitious plans for the future.

In late April, Mohamed Sultan Al Qadi, the chief executive officer of real estate developer RAK Properties, said the company had put $1.1bn worth of projects on hold, many of them in the tourism sector.

“We were going to build 11 hotels, but it has been put on hold because of the financial crisis and we’re now building one hotel,” Al Qadi told the Reuters news agency.

Of course, these projects have just been put on hold, not cancelled, and are expected to be revived when the economic climate recovers. Most of the other major tourism developments being carried out in RAK are still on track and officials are expecting a 10% increase in visitor numbers this year, many attracted by the emirate’s mix of luxury and landscape.