Abdulrahman al-Saley, department of financial chief, states that creditors were responsible for their own lending decisions and should differentiate between companies and the state. Mr. Saleh says, âCreditors need to take part of the responsibility for their decision to lend to the companies. They think Dubai World is part of the government, which is not correct.â http://tinyurl.com/y88a7o2
good question... but someone else will bail out dubai. ...too bog too fail again ... but 'too big too fail' means a day the whole system will fail, imo
Which part of 'government owned' is it not understood ? Dubai is in a bind. Their oil rich partners in Abu Dhabi is in no hurry to bail them out, which they could, in an instant. Abu Dhabi wants something in return. Now Sheik Mohammed is telling his creditors, mainly British banks, that Dubai World is not really government owned so Dubai is not liable for the debt. He is hoping his creditors will write down the debt and the problem will go away once the world economy recovers. "Dubai World was established under a decree ratified on 2 March 2006 by Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the United Arab Emirates and Ruler of Dubai. He also holds the majority stake in Dubai World. On 2 July 2006, it was launched as a holding company with more than 50,000 employees in over 100 cities around the globe. The group now has extensive real estate investments in the United States, the United Kingdom and South Africa. Dubai World made headlines in March 2008 after its chairman, Sultan Ahmed bin Sulayem, threatened to take the fund's money out of Europe.[1] Dubai World's threats came shortly after the European Union attempted to lay out "a set of principles for transparency, predictability and accountability" for sovereign wealth funds.[2] On November 26, 2009, Dubai World proposed to delay repayment of its debt[3], which raised the risk of the largest government default since the Argentine debt restructuring in 2001. Dubai World, the investment vehicle for the emirate, asked to delay for six months payment on $59 billion of debt.[4][5]"