(December 10, 2009) – Bowing to international and internal pressure, Dubai is now considering selling some of its assets to service its $60 billion in debt.
According to Dubai Finance Department Director-General Abdul Rahman al-Saleh, Dubai World—which recently, with much consternation and fanfare, stated that it needed to restructure $26 billion worth of debt—would sell assets to raise cash.
Al-Saleh did not say which assets would be sold, but did state that they would come from Dubai World. Consistent with previous statements, al-Saleh made clear that the government of Dubai is not on the hook for the plight of Dubai World, its sovereign wealth fund.
“Like any company that has commitments, part of getting liquidity is selling some assets. Of course, local or foreign assets,” al-Saleh said on the Doha-based al-Jazeera network on Monday.
The decision to sell assets comes after a week in which Dubai’s potential default rattled world markets. Although the problems with Dubai have been known for months (to read ai5000’s June article on Dubai’s problems—“Dubai (S)inc”—click here ), its admission that debt taken on to fund real estate development caused a sharp decline in world markets in late November.
To contact the <em>aiCIO</em> editor of this story: Kristopher McDaniel at <a href='mailto:kmcdaniel@assetinternational.com'>kmcdaniel@assetinternational.com</a>