Fitch Ratings: Wynn Resorts’ IR project to boost Ras Al Khaimah’s economy?

Jenny Ortiz May 24, 2024

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Fitch Ratings: Wynn Resorts’ IR project to boost Ras Al Khaimah’s economy?

A recent analysis by Fitch Ratings says the ongoing joint venture between Wynn Resorts and Ras Al Khaimah (RAK) is expected to significantly enhance the emirate’s economic growth. The project, which involves the construction of the Middle East’s first integrated resort on Al Marjan Island, is scheduled to open in early 2027 and is poised to attract substantial investment and tourism to the region.

Wynn Resorts has partnered with state-owned enterprises RAK Hospitality Holding and Marjan LLC to bring this ambitious project to fruition. Ras Al Khaimah, one of the seven emirates of the UAE, will host this landmark resort, marking a significant milestone in its economic and tourism development.

Economic forecast and rating upgrade?

Fitch Ratings has upgraded Ras Al Khaimah’s Long-Term Foreign-Currency Issuer Default Rating from ‘A’ to ‘A+’, citing robust medium-term growth forecasts and resilience to external shocks. The agency attributes this upgrade to the anticipated economic benefits from large-scale investment projects like the Wynn integrated resort and the emirate’s ongoing economic diversification efforts.

The construction phase of the resort is projected to increase RAK’s real GDP by 1 percentage point in 2023, 2 percentage points in 2024, and another 2 percentage points in 2025. Initially estimated to cost $3.9 billion (€3.6 billion), the project represents approximately 32 percent of RAK’s GDP in 2022, highlighting its substantial economic impact.

Future development plans?

In addition to the Wynn Resorts project, the announcement of two other major development plans, RAK Central and Beach District, has sparked interest from both domestic and international investors. These projects are expected to further bolster RAK’s economic growth, with forecasts predicting a 6.2 percent growth rate in 2024 and 5 percent in 2025.

Legal and regulatory environment?

The UAE has recently moved towards legalising gaming, establishing the General Commercial Gaming Regulatory Authority (GCGRA) led by Jim Murren, former chairman of the American Gaming Association. This regulatory development is expected to support the growth of the gaming and entertainment sectors in Ras Al Khaimah and the broader UAE.

Political and institutional stability?

Ras Al Khaimah benefits from its integration within the UAE, sharing the federation’s monetary and exchange-rate system and receiving significant federal support. The emirate scores highly in areas of political stability, rule of law, institutional quality, and control of corruption, reflecting its adherence to the UAE’s high governance standards.

Overall, the Wynn Resorts project and subsequent developments position Ras Al Khaimah for substantial economic growth and increased investment, solidifying its role as a key player in the region’s tourism and hospitality sectors.?