Restructuring Talks Premature, But Caution Still Warranted

Alarm bells are once again being raised about the UAE's debt pile, following reports in early December 2011 by ratings agency Moody's and the Financial Times newspaper which stated that Dubai was considering restructuring several bonds in 2012. Moody's singled out several firms that fall under the wider 'Dubai Inc.' umbrella of quasi-sovereign corporates that may encounter refinancing difficulty, including DIFC Investments and Dubai Holding Commercial Operations Group (DHCOG), in addition to Jebel Ali Free Zone (JAFZA). Combined, the three firms have approximately US$3.8bn in maturing debt coming due in 2012.

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