Interpac Business and Migration Solutions Melbourne Australia

(May 24, 2010)

The governments of both Dubai and the United Arab Emirates are to implement urgent reforms to address weaknesses in their financial systems, Sheikh Ahmed bin Saeed Al-Maktoum says.

Dubai's "Supreme Fiscal Committee... is establishing a comprehensive program to address vulnerabilities in our financial system," Sheikh Ahmed, who chairs the committee and is head of the Emirates Group, said on Sunday.

"At a federal level, urgent steps are being taken to address the gaps in the UAE's legal and regulatory infrastructure," he said at the opening in Dubai of the two-day MENASA economic form.

"A clear framework for the financial restructuring and reorganisation of companies, based on international principles, is being put in place" across the federation, he said.

And "the (federal) government is set to issue a public debt law this year," after which it will "establish a debt management office to coordinate the raising of debt for government-related entities," he said.

"A similar debt management unit is planned to be set up in Dubai to centralise debt decision-making."

Dubai rocked global financial markets in late November when it said it might need to freeze debt payments by its largest conglomerate, Dubai World, stoking fears of a state default over sovereign debt.

The conglomerate said on Thursday it had "in principle" reached an agreement with most of its bank lenders, but the proposal still required the approval of its remaining creditors.

Dubai World's total debt, including liabilities, is about $US60 billion ($A74.5 billion). Dubai's total debt is estimated at between $US80 billion and $US100 billion ($A99.4 billion and $A124.2 billion), although some analysts say it could be as high as $US170 billion ($A211.2 billion).

(Source from: theage.com)