Dubai World debt pile decision looms

Crunch time is approaching for Dubai World as the government is nearing a decision on how much money it can apportion to deal with the holding company’s estimated $22bn debt pile, most of which is held by one of its subsidiaries, the developer Nakheel.

The Dubai Financial Support Fund, which oversees the $10bn in bail-out loans extended by the United Arab Emirates central bank in February, is expected to make a recommendation either this week or next week on the holding company’s request for billions of US dollars to aid its debt restructuring plan.

Dubai is showing signs of recovery amid global economic optimism. But how the emirate copes with its $80bn-plus debt pile will impact on the speed of any recovery and is also preying on the minds of institutions with Dubai exposure.