Creditors of companies that go bust in the Emirates are likely to be paid less than in most other Arab countries, creating a deterrent to investment, says a report from the World Bank.
Policymakers in the country have been urged to focus their efforts on reforming the UAE’s insolvency framework to lay the foundations for a better business environment.
Creditors get an average of 10.2 cents (37 fils) in the dollar if a company in the UAE files for bankruptcy, data from the World Bank’s International Finance Corporation shows. In MENA, only Mauritania has a lower rate of recovery, at 6.7 cents. Bahrain has the highest rate of recovery in the region: creditors can on average expect to get back 63.2 cents in the dollar.
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