A major free trade zone (FTZ) in Ras Al Khaimah (RAK) is looking to build on recent growth and expand its base to include new areas of business from an increasingly broad range of countries.
The RAK FTZ reported in mid-February that more than 2000 new companies signed up at the emirate’s main business hub in 2011, marking a 17% increase on the number in 2010, while firms renewing their licences rose at a similar level to reach 3776 at the end of last year.
The increase, which brings the number of companies listed at the RAK FTZ to more than 5000, has also seen the business hub extend its reach globally, with over 106 countries represented at the FTZ at the end of 2011. Officials hope that efforts to promote the zone’s facilities to potential investors at trade fairs and presentations internationally will raise its profile still higher.
Announcing last year’s results in February, RAK FTZ’s CEO, Oussama El Omari, said the zone’s rapid growth stood well above the regional average. “That this growth comes amidst the prevalent challenging economic order reflects the investor confidence in our business model,” he said.
The head of sales and leasing at the Dubai office of international property consultancy Cluttons, Mario Volpi, said the zone is making a key contribution to overall economic development in the emirate, with the results of its expansion extending beyond the direct revenue it is generating.
“The RAK [FTZ] is doing good business and there is a good mix of companies that have either set up there or have opened a second operation in the emirate,” Volpi told local media in late February.
While RAK FTZ officials are confident that 2012 will bring a similar rise in company registrations, the management is taking steps to prevent a loss of momentum in growth that could be triggered by fall-out from the European debt crisis or a possible double-dip recession in the global economy.
Plans include increasing the range of activities that can be carried out within the zone’s boundaries, such as the setting up of a dedicated knowledge cluster along the lines of models already operating in Dubai and Sharjah. Education institutions, for example, are already operating at the RAK FTZ. However, the zone’s officials are waiting for a planned regulatory council that will be tasked with licensing and overseeing new institutions to begin operating before moving ahead with their aim of establishing a wide-ranging education centre on site.
While the established learning hubs in other emirates represent competition, NM Kondap, the head of higher education at Core Education and Technologies, said the RAK FTZ should be able to carve out its own niche once the range of courses on offer is expanded. The Mumbai-headquartered international education solutions provider, which is the latest firm to announce it is setting up a base in RAK, will work with the Birla Institute of Technology (BIT) Ranchi to offer programmes in engineering, architecture and business administration.
“We are offering something which will be recognised internationally, and our courses, the input of industry and academic content will be our differentiators,” Kondap told The National on February 29. “In time, we will open schools of hospitality and tourism management as that is really growing in the area. There will also be infrastructure management and retail, but all in time. We want to start this slowly.”
With an established accreditation and regulatory council in place, the RAK FTZ should be able to attract more education providers, which in turn is expected to act as a draw for other related service firms. The zone’s leaders will also be hoping that the broader base of companies at the hub could play a part in reducing a possible slowdown if regional and global demand for trade and services taper off.
Maintaining the momentum RAK FTZ has built up in recent years should help officials drive forward the FTZ’s expansion plans, while cementing its place as a key component in the emirate’s overall economic development.