How true - Dubai opaque
"Investors in the region know this $10 billion will be used to support infrastructure and liquidity of government related entities (GREs)," said Nish Popat, ING's head of fixed income in the Middle East. "But will it be $10 billion? Will there be a federal guarantee? Will there be a rating, and if so will there be greater transparency in finances of the country?Read my roundup of news on the dismissal of Dubai's former finance chief, Nasser al-Shaikh, here.
"There are more questions than answers for investors."
"The problem with Dubai is the lack of details, numbers from both corporates and sovereigns," said a debt fund manager in London after returning from an investment trip to Dubai. "You can only buy things on the assumption they will be bailed out by Abu Dhabi. There is no reason for optimism any time soon."
The primary concern for investors remains a transparent process. The dismissal of Dubai's former finance chief, who was well-regarded in the financial community, did little to inspire confidence. He was surprisingly removed a day after leading a panel at the World Economic Forum on the future of the emirate.
No reason has been given for his dismissal. Most analysts believe he was too open, but unless the new finance minister is also communicative, Dubai may still grapple with recovery.