Financial Asset Management

Dubai is one of seven emirates that make up the United Arab Emirates. Dubai has very few energy resources and raises little money via income tax due to its competitive tax policies. The city-state has consistently run deficits and its growth has therefore been funded via the money markets. Abu Dhabi, with its huge oil reserves, is the wealthiest of the emirates, and its banks are major creditors of Dubai and many of Dubai’s companies.

Dubai World, the most indebted of Dubai’s state-sponsored companies, owes $60 billion, of which $22 billion must be refinanced by 2011.

The news on November 25, 2009, that Abu Dhabi was no longer willing to keep buying or refinancing the debt of Dubai’s major companies shocked the world’s stock markets.