Dubai: Dubai World will sell some of its assets to part finance its $26 billion debt, a senior city-state official said amid a sharp fall in the main stock exchanges in the United Arab Emirates on Monday.
The director-general of Dubai’s department of finance, Abdul Rahman Al Saleh, told the Al Jazeera television channel that the government will not sell any of its assets to bail out the conglomerate.
He said the company will overcome its credit problems by restructuring the debts and selling its own assets.
Al Saleh said the Dubai Financial Support Fund could extend support to Dubai World if needed.
He said Dubai World’s and Nakheel’s problems originated from short-term lending on long-term projects.
“It doesn’t work, especially in a volatile market situation. Most of Dubai World’s and Nakheel’s projects are of strategic importance and long-term. You can’t develop them through short-term borrowing,” Al Saleh said.
The Dubai Financial Market slumped by more than 5% and the Abu Dhabi Securities Exchange dropped by 1.73% after yesterday’s rise from last week’s gains.
Kuwait’s stock market was also down 0.79%.