February 24, 2009 at 3:23 pm #54774
Article in the Daily Mail today.
Ailing Dubai seeks £14bn bonds lifeline
Bill Condie, Evening Standard
23 February 2009, 10:47am
The Dubai government, nearing bankruptcy since the property boom that has driven its growth hit the wall, is heading to the bond markets to try to raise $20bn (£13.7bn) to pay down a big chunk of debt due this year.
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Dubai, part of the United Arab Emirates federation, has little oil revenue, and its economy has been propelled by the property boom for the past six years. But that was one of the first casualties of the global financial crisis and now Dubai, home to 100,000 British expatriates, is in tatters.
The UAE says the first $10bn tranche of the bond issue was fully subscribed by the federation’s central bank, and the bond will provide Dubai ‘with the necessary liquidity to substitute the liquidity that has dried up globally in the last 12 months and accordingly meet all upcoming financial obligations’.
The bond will be unsecured, fixed-rate paper, yielding 4% a year, with a five-year maturity. Thousands of UK workers went to Dubai during the boom but many have lost their jobs
February 24, 2009 at 3:30 pm #90411
Totally unsurprising given the way the whole Dubai thing was and actually is a castle built on sand.
This is where quality comes up again.
Monaco is still safe and yet the great glitzy pretender (Dubai) does not even come close.
Cheap fashion is no substitute for quality.
February 27, 2009 at 2:00 pm #90488
Talking of Dubai, according to the moneywise website:
“Wild rumors spread as fast as the desert wind: The Palm Jumeira…..is said to be sinking”.
I lived in Abu Dhabi for ten years during the ’80’s and it was no rumour that Sheikh Zayed bin Sultan Al Nahyan, when wanting to build the city on the tip of the peninsula, was told by several engineers it couldn’t be done – that the water table was too high and it would eventually sink. Needless to say they were fired and an alternative engineer found who said “No problem, your Highness” and got the contract!
While I was there, it only had to rain for half a day and the streets started flooding…..and it was not from blocked drains. If The Palm in Jumeira is in fact sinking it wouldn’t surprise me – nor if Abu Dhabi eventually follows.
edited twice as half my post disappeared into cyberspace. 😕
February 27, 2009 at 2:33 pm #90492
A friend’s Son has handed his keys to the bank. He had a property on La Palm. He claims they are impossible to sell and have been for some time.
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