Ras al Khaimah (RAK) investors have ceased negotiations over the acquisition of a Congolese airline, but remain bullish about the Democratic Republic of Congo's property and mining markets. Last July, Ras al Khaimah Investment Authority (Rakia) announced its intention to buy a 60 per cent stake in a defunct Congolese airline, which does not have its own fleet but possesses existing air rights to several destinations in central Africa.
The northern emirate has, however, decided to cancel that prospective investment, estimated to be valued at Dh587.2 million (US$160m), after a number of problems were identified, a source close to the matter said. Those problems included the current Congolese national airline's debt record in several airports and the necessity to invest unexpected amounts in domestic airports in order to successfully run routes. "The Congolese government was helpful but the situation wasn't completely clear," the source confirmed.
Construction of RAK's first development in Congo - a five-star hotel - is still due to start by the end of this year, according to Rakeen, the emirate's main master developer, while the hotel's operator will be officially appointed within the next month. "We bought the last big plots of land that were available in the business district of Gombe, in Kinshasa, where you also find all the embassies," said Marc-Henri Veyrassat, the chief operating officer of Rakeen.
In total, Rakeen will build a five-star hotel of 300 rooms, three residential towers, two office towers and a conference centre with room for 800 people. The first development, which will include the hotel, convention centre and a residential tower - called Palais de la Justice - will cost Dh1.8 billion. Financing will be guaranteed through a 12-year loan. "Our policy is to enter a market very soon and have first-mover advantage," Mr Veyrassat said. "But we are not entering with closed eyes."
All Rakeen's projects were done in association with the World Bank's private financing arm, the International Finance Corporation, he said. "It wouldn't have been possible otherwise." RAK sent its own construction company, Al Hamra Construction, to build the projects. RAK has also invested in the African mining sector. RAK Minerals and Metals Investments (RMMI) is involved in copper and cobalt exploration in the Katanga province, Congo's mineral heartland. In March, RMMI acquired stakes in two local mining companies, and is now examining other opportunities in the south of the country.
Late last month, Sheikh Saud bin Saqr, the Crown Prince and Deputy Ruler of Ras al Khaimah, met with Congo's industry minister to discuss an expansion of economic ties between the two countries. "Congo has vast potential and we would like to participate in the country's development, which will enable it to attain its full growth potential," Sheikh Saud said. @Email:ngillet@thenational.ae
