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Dubai Government Won't Sell Assets for Dubai World Debt
Dubai's government will not sell any assets to meet the obligations of state-owned Dubai World, but the conglomerate itself might sell some of its foreign assets, Dubai's finance chief told Al Jazeera television.
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Str / AP "The World project" by Nakheel. |
"Part of obtaining finance is selling assets ... belonging to the company and not the government," Abdulrahman al-Saleh, director general of Dubai's Department of Finance said in an interview posted on the news network's website on Monday.
"There is confusion in the media that the government plans to sell assets ... the company has foreign investments and real estate investments abroad. There is nothing to prevent selling these assets."
Dubai World has local assets that could be earmarked for sale to meet the debt, Saleh said, reiterating that the government does not guarantee the debt of the conglomerate.
Government-owned Dubai World requested a payment standstill on Nov. 25 for $3.52 billion worth of Islamic bonds maturing this month as it looks to restructure $26 billion worth of debt.
Saleh declined comment on Dubai World's talks with creditors or previously announced plans by the government of the emirate to raise a further $5 billion in bonds.
"It is better to leave this in the hands of Dubai World's management, the consultants and the other parties (creditors)," he said, adding that the emirate was capable of meeting it sovereign debt obligations, estimated at about $20 billion.
Government-linked entities debt is estimated at another $70 billion.
Answering a question about whether the Dubai Financial Support Fund could offer backing to Dubai World, Saleh said the group had already received support from the body, adding that it was "communicating" with it, but did not elaborate on the nature of their correspondence.
Dubai set up the fund in July to support the emirate's government entities in the face of the global financial crisis.
"The outcome of the restructuring is left in the hands of the management of Dubai World and the consultants and contacts with relevant parties -- investors and creditors," he said.
"The main goal of the restructuring of Dubai World is to guarantee its continuation in a new framework," Saleh said, adding that it was "premature" to speak about specific plans about Dubai World's restructuring.
Copyright 2009 Reuters. Click for restrictions.
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