How To Brand An Emirate?
09 January, 2014
When several years ago Dubai gained international recognition as a famous financial centre, the hereditary ruler of Ras Al Khaimah (RAK) Sheikh Saud bin Saqr Al Qasimi realised that it was the highest time to place the northernmost part of the United Arab Emirates on the world map as well.
With population of only 230,000 and no oil resources, this seemed like an impossible task. Compared to Dubai and other territories in the Gulf, RAK had seemingly very little to offer to foreign investors. The search for its own branding started.
DARE TO BE DIFFERENT
It was RAK's difference from all other emirates that became its prime asset. As the ruler said himself: "RAK has its own uniqueness. If we talk about geography, RAK has unique beaches, sand dunes and mountains. It has also a unique rich history and archaeology."
TOURISM has indeed become one of the major pillars of the economy, accounting for almost 10% of the GDP. Within its rather compact territory, RAK offers all the features that tourists seek: as the only one out of 7 emirates, it combines see, sand and mountain ranges. Thanks to its premium hotels and resorts, it offers the popular combination of luxury and adventure. The government is investing $500 million in tourism development projects, which include bringing RAK's total hotel and resort room inventory to 10,000 by 2016.
Another focal point is EDUCATION. In 2013, the government reserved 22% of GDP for education. It is currently in negotiations with several foreign universities that are interested in opening their campuses in RAK, following the example of the University of Bolton (Manchester, UK). This school deliberately chose RAK above Dubai as RAK is quiet, cheap and not overpopulated. According to the school officials, the pace of life in RAK is much more beneficial for those who are seriously into studying.
Although there is no oil in RAK, there are other NATURAL RESOURCES there. RAK is the largest cement producer in the UAE. The $1 billion RAK Ceramics is the world's largest manufacturer of ceramic and porcelain tiles.
Meanwhile, RAK'S FREE TRADE ZONE is one of the fastest-growing in the region. It is made up of a business park free zone, an industrial park free zone and a technology park free zone. RAK free zone companies offer 100% foreign ownership, zero corporate tax and the freedom to repatriate profits. This all at a cost of living that is at least one third lower than in Dubai.
DOES SIZE MATTER?
Despite all efforts, the branding of RAK does not move with the expected speed. Can it be due to the limited size of the emirate? Its 1600 square kilometres is only a small fraction of Abu Dhabi (67000 square kilometres). Not quite as RAK picks the smallest territories as its example. Places like Vatican, Las Vegas and Mote Carlo have managed to successfully introduce a clear brand. All they needed was daring to show difference.
Even though the branding efforts cannot be precisely quantified, the results are here already. Only a few weeks ago, Standard & Poor's Ratings Services affirmed its 'A/A-1' long- and short-term foreign and local currency sovereign credit ratings on the Emirate of Ras Al Khaimah. According to S&P analysts the outlook is stable. The affirmation reflects their view of Ras Al Khaimah's limited fiscal risks due to the government's minimal spending responsibilities, its strong government balance sheet, and ongoing indirect financial support from the UAE...
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