Tuesday, December 08, 2009

Dubai Government is capable of meeting its commitments

The Dubai Government is capable of honouring and meeting its internal and external commitments, confirmed a senior Dubai Government official today.

The Director General of Dubai Finance Department, Abdul Rahman Al Saleh, said that the re-structuring of Dubai World is a natural procedure that could happen in any country and to any company.

"The media has blown the issue of re-structuring part of the group's debts, including delay in repayment of Nakheel's debts out of proportion. Restructuring of companies is a common practice worldwide in several countries and companies," Al Saleh said.

Al Saleh strongly refused that Dubai Government has announced that it would not guarantee debts of the group, and added that the Articles of association of Dubai World stipulates that the emirate's government shall not guarantee its debts, and pointed out that the distinction should be made between the Dubai government and the group which comprises several companies, including Nakheel and Limitless World, operating in several sectors.

Re-structuring is aimed to allow the group to steam ahead with a new shape and keep abreast of changes, Al-Saleh said, and continued that as for cancellation of projects by the group, it is better and wise to delay projects that are yet to be executed.

He agreed that few assets of the group in Dubai or abroad may have to be sold, but said that it is a natural act to bolster the financial situation of the group under such circumstances.

Although Dubai World is active in several sectors, it is the real estate sector that has been much impacted by the international financial crisis.

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