Dubai’s bond ‘is not a bailout’ (Interview thru Press Release)

In an interview published by the Government of Dubai, Abdul Rahman al Saleh talks for the first time since replacing Nasser al Shaikh in May as director general of Dubai’s Department of Finance about how the US$20 billion (Dh73.46bn) in bond money will be distributed to government-related companies.

Q Can you tell me what is the purpose of this fund?

A I would like to go back to earlier this year when the Government has taken a very important step in issuing the $20bn bonds. That was an immediate decision to support the government-related entities to meet their obligations. From there we have been working closely with our consultants to get the right set-up: the right set-up in the sense of how we manage the funds, how we’ll be able to raise additional funds and how we can work very closely with the government-related entities. And now we have the decree, signed by His Highness, setting up the Dubai Financial Support Fund to be a separate legal entity, working very closely with the Government and supporting all strategic projects which are very important for the government strategy. The fund will be working with the government-related entities and supporting them, but it will be on a commercial basis so that it’s challenging for them to meet their obligations and to be able to manage their requirements in the long term.