An important Abu Dhabi policy advisory board headed by the emirate’s influential crown prince has urged the capital of the United Arab Emirates to establish a “comprehensive economy stimulant package” for the entire country.
The report comes as bankers and credit analysts warn that oil-rich Abu Dhabi’s unilateral decision last week to recapitalise its own five banks exposes other UAE institutions to unwelcome scrutiny. Fitch Ratings said in a report on Thursday that Abu Dhabi’s action “leaves other banks in the UAE looking potentially more vulnerable in the event of a significant domestic downturn”.
This sparked fears that the capital of the UAE may hesitate to support neighbouring emirates such as Dubai. A senior Abu Dhabi official told the FT at the end of last week that there had been no formal approach by Dubai to ask for help in securing banks and other institutions in the UAE’s commercial capital.
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