The economic crisis in Dubai is over, the United Arab Emirates foreign minister said on Thursday. The $10 billion aid package this week from the wealthiest emirate Abu Dhabi to Dubai had proved the unity of the Emirates, Sheikh Abdullah Bin Zayed Al-Nahayan said. Speaking to Reuters during a visit to the Israeli-occupied West Bank, he said the United Arab Emirates government was “committed to dealing with the effects of the global crisis” for all UAE members. “The economic crisis in Dubai is over,” he said. The lifeline to fellow-member Dubai “is proof that the UAE is united politically and economically”, Sheikh Abdullad added. “It is also proof that UAE remains committed towards local government to deal with effects of the global economic crisis. “I believe the (global) crisis will be behind us once the United States recovers, and we believe the United States is recovering, which will reflect on other countries.” Dubai World rocked global markets on Nov. 25 when it asked creditors for a standstill in debt mainly linked to its two property firms, Nakheel and Limitless World. Abu Dhabi came to the rescue of Dubai on Dec. 14, several days after state-owned conglomerate Dubai World asked creditors for a delay on payments of debts totaling some $26 billion. The UAE safety net, in the form of bonds to head off a bond default, cheered Gulf and global markets but raised questions about the undisclosed terms As Dubai developers reassured the world their ambitious construction projects would go ahead, officials from the emirate were expected in New York to shore up confidence after a debt landslide threatened its top companies. A government source said Sheikh Ahmed bin Saeed Al-Maktoum, chairman of Dubai's Supreme Fiscal Committee, and Mohammed al-Shaibani, chief executive of the Investment Corporation Dubai, were due to visit New York and Washington on Thursday and Friday, following a trip to London on Wednesday. With global markets recovering from two years of financial crisis, Dubai delivered a sizeable aftershock on Nov. 25 when it asked for a standstill on $26 billion of debt linked to its flagship conglomerate Dubai World and its two main property units, Nakheel and Limitless. This week Abu Dhab lent it $10 billion to meet Dubai World's obligations until the end of April and stave off a bond default by Nakheel, developer of its palm-shaped islands. Dubai's government may also repay outstanding 2010 and 2011 Islamic bonds issued by Nakheel and provide further funds to Dubai World. Abu Dhabi's loan has alleviated immediate concerns, but banks remain uneasy about the billions of dollars they lent to fuel Dubai's development boom on the assumption the emirate's or the oil-rich federal government would back the debt. “The headline risk remains, as Dubai World is still involved in a fluid process, so it is still key to proceed the dialogue with international investors,” said Ali Khan, managing director and head of brokerage at Arqaam Capital.
