16th Oct, 2023 – The leading credit-rating agency, S&P Global Ratings, has updated its evaluation of Ras Al Khaimah's economic prospects, shifting from a 'Stable' outlook to a 'Positive' one. This change signifies a heightened belief that the Emirate's economic growth might surpass initial expectations. Simultaneously, the agency has reaffirmed RAK's foreign and local currency sovereign credit rating at A-/A2 for the long and short term.
The credit ratings report by S&P Global Ratings highlights Ras Al Khaimah's robust economic foundation, driven by diversification, sustained long-term policymaking, and a strong economic base. The deliberate investment strategy, with a focus on tourism, is enabling Ras Al Khaimah to leverage increasing interest from investors, businesses, and tourists.
Central to the reevaluation conducted by the prominent credit rating agency is the conviction that Ras Al Khaimah's economy is gaining momentum, propelled by a solid pipeline of construction activity from tourism projects in the next five to six years.
The agency additionally points out that the Emirate still enjoys advantages from non-oil sector expansion and infrastructure investments in the UAE, GCC and the Indian subcontinent, with the mining industry in RAK, as well as economic free zones, real estate, and ports, reaping the benefits.
S&P Global Ratings notes that the economy of Ras Al Khaimah is "well-balanced," lacking a dominant sector driving its economic activity. The Emirate's economic growth is distributed across various sectors, with manufacturing, wholesale and retail trade, construction/real estate, and mining collectively contributing to approximately 50% of its GDP.
S&P Global Ratings also emphasise that Ras Al Khaimah benefits from its affiliation with the United Arab Emirates, which bolsters its fiscal strength and stability. It highlights that being part of the UAE provides additional advantages, including substantial federal investments in the Emirate. Further, S&P Global Ratings have indicated the possibility of increasing the ratings in the next two years if Ras Al Khaimah's economic outlook continues to improve.