Mr. Haitham Mattar, CEO of Ras Al Khaimah Tourism Development Authority, explains how Ras Al Khaimah has been able to combine its natural beauty and cultural heritage with innovative business opportunities
How do you think a global event such as Expo 2020 will impact Ras Al Khaimah?
It will in a great way. Export 2020 will provide us with an opportunity to link and leverage the growth that Dubai plans to have.
Also, because of our location there are roads that are being constructed between now and 2020; that brings us a lot closer to Dubai.
We have two major highways, one has been expanded and the second was under development to complete that connection.
I believe there is going to be a great deal of overflow from Dubai during the 2020 expo - which we will benefit from - given our position, our inventory, and the level of the hotels that we have in the Emirate.
When you come to Ras Al Khaimah from Dubai, the new Ras Al Khaimah is about 20 minutes closer to Dubai. So, in a pleasant way, it brings us a lot closer together.
Also, what we intend to do is increase our inventory between now and 2020. Today Ras Al Khaimah has 5,000 hotel rooms.
By 2018 we will have another 2,000 rooms, so they are up to 7,000 and I reckon by 2020 we should have another 500 rooms in the pipeline so we could be looking at 7,000 to 8,000 rooms in Ras Al Khaimah between now and 2020.
Now, first of all that is to cater for our own demand, because tourism for Ras Al Khaimah has shown fantastic growth, and second is to cater for the overflow that we are expecting for the 2020 Expo.
Could you please provide our readers with an overview of what is unique about the culture and heritage of Ras Al Khaimah and how this Emirate has evolved in the contemporary era?
Ras Al Khaimah is actually one of the richest emirates in archaeological and historical sites. We have a whole village here called Jazeera Alhambra.
The village comprises a total number of 452 units including a fort, a souk, a number of notable houses (including the wind towers house) and a lot of them are already UNESCO registered.
The town was originally a tidal island and, by 1830, was home to some 200 people mostly occupied in pearl fishing.
Most of these people have migrated within the emirates and predominantly, to Abu Dhabi. They used to live here in the village until the early 1970s; we also have archaeology from about 3,000 to 4,000 years ago. In the mountains, as well, we have also a placed called the Sheba Palace. This medieval palace is situated on a ridge above the village of Shimal.
It is the only ancient Islamic palace known in the UAE and dates back to the Julfar period (13th-16th century AD).
It was most probably the residence of the ruler of Julfar, once the most famous and prosperous trading town in the whole lower Gulf.
The term "Queen of Sheeba's Palace" refers to the famous queen, who is mentioned in the Quran, and is said to have ruled the Kingdom of Marib in Yemen around 1000 BC.
So, there’s a lot of history stemming from here. We've seen how Ras Al Khaimah has evolved and is now capitalizing on its unique positioning and its unique and longest coastline.
Also, we are at the tip of the Gulf, which allows us to be closer to the open waters, so the color of the sea is different, the color of the sand is different and the nature is a lot different.
Today, the whole development that we have across Al Hamra and Al Marjan is really positioning us to compete with other destinations across the globe, with the offerings that we have.
What's unique here is that we have the proximity between the sea, the sand, the desert and also the mountains, which is quite unique for here.
The mountains rise to about 2,000 meters high and we are now looking at studying a number of activities to include an eco-tourism resort up on the mountains as well as wellness spas, also on the mountains.
There are a lot of activities around this to really bring out that uniqueness of Ras Al Khaimah.
So much has been said about Dubai that is indeed difficult for many people to imagine a different side of the UAE. Eco-tourism is growing at around 6.2% rate worldwide so I guess that is a trend Ras Al Khaimah is focusing on…
And we have the right recipe for it, between the mountains and the sea, the recipe is there.
We have a beautiful nature reserve in Al Wadi, where the Banyan Tree is; the Al Marjan Island - which is hard for me to call them man-made anymore, because it was reclaimed ten years ago and we haven't built on them immediately, so time was given to settle in the sea and become part of it.
So, right now what we are seeing is a great interest from investors and hotel brands. They want to have their hotels and brands on Al Marjan Island. It's a great moment. Dubai has gone through a tremendous amount of growth through unparalleled efforts to attract business and leisure travelers.
We do not compete with Dubai; we actually complement what Dubai has to offer.
Between other cities like Dubai where they are far focusing much more towards the masses, we would like to consider ourselves more as a boutique emirate.
We don't necessarily want to go after the masses, we want those who want to be away from the noise of the city; away from traffic and be able to come here and unwind; for people looking for tranquility, adventure in the desert, in the sea or in the mountains. We have your adventure holiday covered.
If you look at the trends in tourism, for 2014 the UN World Tourism Organization (WTO) reports flat growth for the Middle East region. What are the highlights in Ras Al Khaimah for 2014?
Actually, we've seen fantastic growth in the tourism and economy of Ras Al Khaimah.
In 2014, we witnessed a 37% increase in additional hotel rooms, and despite this, the destination total revenue grew by 44% and 72% in Guest Nights.
This is a clear indication that Ras Al Khaimah has become much more attractive for families.
The really interesting catch here is that we have managed to achieve this growth despite three major factors: the devaluation of the Ruble, the weakening of the Euro, and the increase of inventory.
Our key markets like Europe and Russia have seen a downward trend but we managed to achieve growth through diversifying our portfolio of source markets within market activities to generate demand.
It was through new markets, predominantly India, China and an excellent growth from the GCC countries.
India has seen an 81% growth versus the year before; China was at 63% and the GCC was at 51%. In 2014, during the first quarter of the year, we had a total revenue growth of 26% and we had a 17% growth in the number of visitors.
This is a clear indication that we are on the right track as we are still showing a healthy trend of growth.
Predominantly, people are looking for something different and Ras Al Khaimah has an incredible offer in that sense. We’re simply a different Emirate.
Year 2014 was very successful. What were the reasons for that special success?
There was a lot more activity towards driving the Indian market, which was almost new to us, as well as the Chinese.
Those markets came in hand to really fill in the gaps of what we lost in the German and the Russian markets.
And also, the GCC, where we had proactive marketing campaigns to drive families, showed we were successful.
And the offerings: the fact that you have more rooms, where there are special offerings in the inventory; and beach resorts on Al Marjan Island.
So, for example, the Double-Tree by Hilton and the Rixos were great for this captive audience. We've just signed with Marriot and there's a lot more to come in our plans.
We are in discussions with a number of International Hotel brands; we'll see more signings as we go through this year.
Over 2,000 rooms are planned to open by 2018. It could increase because we are signing more hotels as we speak and this number could certainly increase in the next 3 to 4 months.
25% of the GDP growth of UAE will be coming from tourism sector in the years leading to Expo 2020. Yet, there are some challenges that regard macroeconomic distortions and oversupply of property. Fitch recently reaffirmed A rating for RAK’s IDR (Issuer Default Rating) and other indicators. What does it mean for investors in the tourism and property sector?
Well, it means that we have a stable economy. It also means that we are reliable and credible, because it's not the first time that we have received this score.
It's already the second or third year in a row so it indicates that this is a fertile ground for investment.
It gives investors alternatives beyond mainstream generic investment portfolios because Ras Al Khaimah offers new opportunities for investors.
We've also been able to demonstrate our growth in tourism. We are setting some really ambitious targets for ourselves.
By 2018, we want to reach 1,000,000 visitors. We have 750,000 now but we are geared and ready for this growth.
As I mentioned, we are already seeing a 17% growth in number of visitors for the first quarter this year, so that trend is actually very healthy for us and has enabled us to demonstrate that we were able to achieve our targets.
It enabled us to find new markets that we can tap into. So if I look at the future, and if we look ourselves between now and five years, there's a lot of potential that we'll tap into.
And on the flipside, do you think that the strong Dollar may actually represent new opportunities for Ras Al Khaimah?
Yes it will, because the US market has also shown growth for us. The US market has registered one of the largest growth rates at 38% in 2014 versus 2013.
We are seeing US visitors not necessarily just for leisure but also for business; setting up companies in the free zone, which has already over 8,000 registered companies.
I think the facilities and the services offered in our free zone are very attractive for people from across the world, and the US is definitely one of the key markets for us in this sense.
What are the advantages for a company to come here instead of Dubai?
First of all, we shouldn’t always compare with Dubai as business in the world is growing in every direction as it becomes more global, but also, the cost of living here is substantially lower; with absolutely no compromise to the standard or quality of living.
You are looking at beachfront and easy access to sea locations that are very much at, what I refer to as, "real prices."
It's very easy to set up a company here; there isn’t any red tape that you need to cut; we've done that for you so it's a simple process.
It's very cost-effective and cost-efficient for start-up companies.
Start-up companies that want to explore opportunities, this is a fertile ground because it doesn't require a considerable amount of money or investment; nor it requires a large number of people working for you; and the cost of living certainly supports that.
You recently said: “We are embarking on an ambitious strategy that will see us market Destination RAK to ensure that Ras Al Khaimah can become a globally ranked centre for tourism, inward investment, and trade.” How do you imagine Ras Al Khaimah in five years’ time, let’s say in 2020, due to this ongoing transformation?
Under the vision and direction of His Highness Sheikh Saud Bin Saqr Al Qasimi, Member of the Supreme Council and Ruler of Ras Al Khaimah, we have been tasked to set the bar higher.
We have embarked upon this challenge because of his ambitious will to really grow his Emirate; because of his flexibility in his approach; because of the way that he wants to lay the foundations for a very simple yet effective transformational process.
He wants our visitors to feel at home and experience the adventures, culture and heritage we have to offer.
He wants his partners to be happy; and his investors to be successful. With home grown companies like RAK Ceramics and Julfar, the success of the RAK Free trade Zone, Our economy is set for a sustainable future.
We are on a great journey and this is going to support us with for the next five years and beyond.
We have this great opportunity to capitalize on the foundations on this Emirate, what we have to offer between its heritage and its culture and between the sea, the desert, and the mountains.
Also, one of the key components that needs to be mentioned is the fact that we are actively targeting families, young couples and millennials.
We are building the future and the future is the millennials.
And If I see beyond five years, if we look at ten years from now, what we are building on Al Marjan Island, in one of the islands that really focuses on lifestyle, adventure, fun, and celebrations.
That is very much targeting millennials.
So, it gives us a diverse window of opportunity to drives different segments and sources of travelers who want to come to Ras Al Khaimah.