Dubai’s additional $10 billion loan from Abu Dhabi still up in the air
In order to support the struggling government related companies, Dubai must raise an additional $10 billion. This is according to one of the leading analysts at Standard and Poor’s.
Right now, there is around $4 billion for that support says Farouk Soussa, who heads the Middle East government ratings at Standard and Poor’s. At the Dubai International Financial Center Economic Conference, he said that this was simply insufficient. At the worst of the world’s financial crisis, the United Arab Emirates central bank out of Abu Dhabi underwrote the first half of a 20 billion bond program that was created to bail out the struggling economy.
It is expected that the UAE central bank will once again step in to help. If not, then the help may come from the Abu Dhabi government. Some analysts think that Dubai will be able to raise the money by November.
Part of the financial crisis has been the falling real estate prices, with many areas seeing a 50% reduction in property values. However, there is also $50 billion in debt that will be due in the next three years. For the present time, it’s uncertain how Dubai will work to repay this debt.
