Dubai World to Restructure Debt

The doomsday of Dubai’s economy is yet to come. The market is ok. It’s just a minor problem, says Bloomberg.

Dubai World said it began “constructive” talks with banks to restructure $26 billion of debt, including liabilities owed by units Nakheel World and Limitless World.

Debt from subsidiaries such as Infinity World Holding, Istithmar World and Ports & Free Zone World will be excluded from the negotiations because those companies “are on a stable financial footing,” Dubai World, one of the emirate’s three main state-related holding companies, said in a statement.

The company is seeking to delay payments on less than half its $59 billion of debt, damping concern that its potential default may set back the global financial system’s recovery from the credit crisis that sank the world economy into recession. Stocks erased losses in the U.S. after the announcement, sending the Standard & Poor’s 500 Index up 0.4 percent.

Tags: economy, united arab emirates

This entry was posted on November 30, 2009 at November 30, 2009 and is filed under Asides. You can follow any responses to this entry through the RSS 2.0 feed.

akhlis
December 1, 2009 at 8:51 am

Is it a potential of another global economy crisis? Realizing how close people get connected to each other nowadays is really frightening sometimes. The effect is always increasingly contagious and thus the domino effect applies. One economic titan collapses, the rest of the world get affected afterwards in some other way. And I wonder what Indonesia can do when another economy crisis hits, particularly in the threshold of free trade era.