Messenger shot. Dubai's ruler sacks his outspoken finance chief

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The dismissal of Nasser al-Sheikh as the director of the Dubai Department of Finance has raised questions about the emirate's plans to tackle its daunting debt-service challenge and restructure its network of government-controlled corporations. Mr Sheikh had sought to bring a more transparent approach to the task of running the emirate's finances. It seems that this may have been his undoing, as it conflicted with the traditional way of conducting business behind closed doors. Dubai will now have to move quickly and effectively to reassure its creditors that its debt settlement plans are still on track.

The news of Mr Sheikh's removal came in a statement from the United Arab Emirates (UAE)’s national news agency that Dubai's ruler, Sheikh Mohammed bin Rashid al-Maktoum, had reassigned him to the position of assistant director of external affairs at the ruler's diwan (royal court)—effectively a major demotion. His replacement as head of the finance department is Abdul-Rahman Saleh, who previously worked as a senior executive for corporate affairs at Dubai's customs authority. No reason was given for the change.

Mr Sheikh had been promoted to head the finance department last October as part of a wider reorganisation of senior posts in Dubai. His predecessor, Omar al-Qamzi, moved across to become director-general of the Dubai Department of Economic Development, replacing Mohammed Ali Alabbar, one of the emirate's leading businessmen. Mr Sheikh's original appointment came at the moment when Dubai's real estate-driven economic boom was coming to an abrupt halt. He was closely involved in efforts to clarify the level of indebtedness of the Dubai government and its corporate affiliates and in raising funds to cover these debts. In February, Mr Sheikh's department announced the launch of a US$20bn bond programme, to which the Central Bank of the UAE subscribed to the entirety of the US$10bn first tranche. Mr Sheikh indicated that he would in due course announce details of how these funds had been allocated, but this information has not yet been forthcoming. In the meantime, contractors have been complaining with increasing anxiety about the failure of Dubai developers to pay their bills.