Tuesday 8 December 2009

Cliffhanger in Dubai’s tale of two cities

Dubai’s unpleasant Eid surprise has been put in perspective – as a debacle in the emirate, rather than a global disaster.

Even local markets have started to digest the message of the authorities: that there is now a good Dubai and a bad Dubai, with the good Dubai likely to be supported by the emirate’s government and the bad Dubai forcing its creditors to share the pain of its ill-fated decisions.

How to distinguish the two, however, has yet to be explained. Creditors are scrambling to figure out which companies’ debts are guaranteed by the government.

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