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Viewing cable 10DUBAI1, RAK Airport Sleepy, but with Residual Russian Connection

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Reference ID Created Released Classification Origin
10DUBAI1 2010-01-07 07:07 2010-12-01 23:11 CONFIDENTIAL Consulate Dubai
VZCZCXYZ0003
RR RUEHWEB

DE RUEHDE #0001/01 0070742
ZNY CCCCC ZZH
R 070741Z JAN 10
FM AMCONSUL DUBAI
TO RUEHC/SECSTATE WASHDC 0028
INFO GULF COOPERATION COUNCIL COLLECTIVE
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RUEHAD/AMEMBASSY ABU DHABI
C O N F I D E N T I A L DUBAI 000001 

SIPDIS 
DEPARTMENT FOR NEA/FO 
NEA/ARP/BMCGOVERN 

EO 12958 DECL: 2020/01/07 
TAGS EAIR, ECON, PGOV, PREL, AE 
SUBJECT: RAK Airport Sleepy, but with Residual Russian Connection 

CLASSIFIED BY: Justin Siberell, Consul General, U.S. Consulate General, Dubai; REASON: 1.4(B), (D)

1. (C) Summary: The Ras Al Khaimah (RAK) Airport is attempting to reinvent itself as a cargo transit point for the RAK Free Zone in the wake of RAK Airways suspension of regular commercial flights in late 2008. The airport is also working to distance itself from its reputation as a transport facilitator for clients such as international arms trafficker Victor Bout, who used the RAK airport as a base of operations. The Wing Air aircraft once linked to Victor Bout are grounded and effectively abandoned. Former RAK Airport CEO Michelle Soliman conveyed continuing concerns about the airport’s reputation and client base, however, and is seeking to identify “more desirable” clients as the airport increases its operations. End Summary.

-------------------------- 
Passengers Slow to Come
------------------------- 

2. (SBU) Former Ras al Khaimah Airport CEO Michelle Soliman told ConGen Dubai PolOff and Embassy Abu Dhabi OFAC Attache shortly before her December resignation that RAK Airport’s growth has been hindered by the failure of its “national” airline, RAK Airways, which began operations in November 2007, but stopped scheduled flights just over a year later in December 2008 as a result of the economic downturn (Note: RAK Airways still operates a Boeing 757 on a wet-lease basis to Hewa Bora Airlines in the Democratic Republic of Congo. End Note.). Although Oussame El Omari, the CEO of the RAK Free Zone (RAK FZ) recently speculated that RAK Airways would become the UAE’s newest bargain airline similar to Fly Dubai and Air Arabia, Soliman saw little prospect for RAK Airways resumption of commercial air services given insufficient operating funds and high management turnover, including seven CEO’s in just two years.

3. (SBU) RAK Airways uncertain future is, Soliman believes, dissuading other passenger airlines from establishing regularly scheduled flights to RAK out of concern that the limited air rights available at RAK airport could be rescinded if RAK Airways begins to operate again. Although a new arrival terminal opened on September 1, 2009, the only passenger flights to RAK airport are four tourism-related chartered flights a week from Europe which began in October 2009.

--------------- 
Focus on Cargo
--------------- 

4. (U) To boost its cargo business, RAK Airport, according to Soliman, has negotiated with RAK Customs to allow companies in the RAK FZ not to pay customs fees on goods going directly from the free zone to the airport as long as the goods depart within 10 days. Some of the free zone companies utilizing this deal are shipping armored vehicles to Afghanistan on cargo flights. Soliman told Poloff and OFACATT that one idea for future expansion of the airport’s cargo business with the RAK FZ would be to make part of the airport a free zone so that goods could transfer directly.

----------------------- 
The Russian Connection
----------------------- 

5. (C) Soliman told OFACATT that Wing Air Services, a company publicly linked to international arms trafficker and UN sanctions target Victor Bout, is still on the Airport’s registration list only because it is the last registered owner of the IL-76 aircraft
and Gulfstream jet now effectively abandoned at RAK Airport on their parking apron. Soliman said Mach Avia Services was at one time identified as the agent of the IL-76, but eventually “washed its hands of it” and claimed that Wing Air Services was responsible for the aircraft. Soliman took EmbOffs on a tour of the airport that included a viewing of Wing Air aircraft. The Wing Air Gulfstream was completely gutted, apparently cannibalized for parts. Soliman said that the Russian companies were kept on short-term lease arrangements so that they could be moved out of RAK as soon more desirable clients could be found (Note: Soliman also pointed out as suspect two new Bombardier CRJ jets worth USD 50 million abandoned by their owners immediately after they arrived. Soliman said the owners are impossible to reach, although sporadically maintenance people show up. End Note).

6. (C) OFACATT asked Soliman if she knew of any links between the Russian maintenance facility at RAK airport, identified on the website azworldairports.com as the Shahed/Aircess facility, and the Sharjah-based Aircess company that served as the headquarters for Victor Bout’s network until its designation by the UN in November 2005. Soliman said that as far as she knew, the facility was run by the company Mach Avia Services, but that Mach Avia’s General Manager (GM) Hussein Obeid is also the general manager of a company called Shahed, which according to Obeid’s business card provides “Air Services”. Soliman noted that Mach Avia was originally registered as the agent for the Victor Bout linked Wing Air IL-76 when it arrived at RAK Airport in March 2004, but later advised the airport that the plane belonged to Wing Air Services. Abousaeda Mustafa, a Russian, informed RAK Airport that the Wing Air IL-76 aircraft had been sold on January 14, 2009 by Libyan Arab Air Cargo to ILEX or ELEX Ventures Limited Company (NFI). Soliman said that RAK Airport could not confirm the validity or authenticity of the documents presented by Mustafa, and that consequently the airport submitted them to the RAK Courts.

7. (C) Comment: Despite its lack of passenger traffic, RAK Airport is looking for opportunities to grow, such as focusing on cargo and drawing in legitimate clients. However, it seems that it will not be an easy road ahead as it still has to deal with legacy issues such as the Wing Air services aircraft, a grounded RAK Airways, and semi-abandoned jets with unreachable owners. Soliman’s resignation from her post as CEO subsequent to this visit also highlights RAK Airport’s inability to keep consistent management at the helm; Soliman is the sixth CEO to leave RAK Airport since 2006. End Comment.
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