This post by Marios Maratheftis of Standard Chartered Bank is part of a beyondbrics series on the big questions in emerging markets in 2011.
Last year was a relatively good one for Dubai – especially when compared to the volatile 2009. The economy began to recover and, more importantly, Dubai World reached an agreement with its lenders to restructure part of its debt. These were positive developments. But one needs to remember that a significant amount of Dubai’s debt will mature in 2011.
I expect Dubai to address the maturing of this debt in three ways: first, by tapping the markets to refinance part of it; second, by selling assets; and third, by going ahead with further debt restructuring. To be sure, there are challenges ahead. But the good news is that Dubai and its lenders are adopting a pragmatic approach to deal with the emirate’s debt.
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