Dubai bank will not buy a conglomerate Dubai World

On Monday the financial markets in Dubai and other Arab emirates on the basis of trades recorded fall by 7%. The alert investors cast doubts on the ability of the emirate to pay the 60-billionth of debt. Monday was the first operating day from Wednesday last week, when state-owned conglomerate Dubai World has asked about the 6-month deferral of loan payments. Statements Dubai World coincided with the beginning of the Muslim holiday of Eid al-Adha.

This news had a negative effect on stock exchanges around the world. However, the reaction was mixed. Today, Asian stock markets rose after Sunday’s message, that the Central Bank of the United Arab Emirates in Abu Dhabi comes to the aid of Dubai World.

Dubai world is experiencing not the best of times after the collapse of real estate markets, freezing many grandiose projects, famous Dubai.

The head of the Dubai Department of Finance Abdulrahman Al-Saleh said that investors should also bear responsibility for the crisis. According to him, banks provide loans based on their own evaluations of projects Dubai World, and not on the basis of state guarantees. Although Dubai World is formally the property of the emirate, from the very beginning it was known that the conglomerate operates independently, without government guarantees.

As the economist of the University of Notre Dame in Lebanon, Louis Hobeika, Dubai should learn from this crisis is an important lesson, realizing the limits of their financial capabilities: “In Dubai, a great potential and ambition. But he has very limited resources for their implementation.

According to Hobeika, Dubai should temper the appetites, and with the help of Abu Dhabi, and possibly Saudi Arabia to restructure payments on debt, then the crisis will be short-lived.

Central Bank of the United Arab Emirates said that the provision of assistance to Dubai World will depend on many factors, and conditions for recovery of each component of the conglomerate will be considered separately