Indebted Dubai looks for help

Dubai, United Arab Emirates - The Dubai government is planning to meet with potential international investors this week as it tries to dig itself out from under at least $80 billion in debt.

Mitsubishi UFJ Securities International said Monday that Dubai's department of finance will meet with fixed income and Islamic investors starting on Thursday. At least some of the meetings are expected to include the department's top official, Abdulrahman al-Saleh, Mitsubishi spokesperson Julie Horiuchi said.

Al-Saleh has kept a low profile since he was installed as the emirate's finance chief in May following the surprise ouster of his predecessor.

Mitsubishi, Dubai Islamic Bank, Standard Chartered and UBS Investment Bank are arranging the roadshow meetings on Dubai's behalf, according to the statement. Horiuchi said the meetings would begin in Hong Kong, and likely include stops in Singapore, Dubai, London and Frankfurt.

A spokesman for the finance department who provided Mitsubishi's statement to The Associated Press did not make any additional details public.

Dubai has struggled to find investors willing to help it repay or refinance its debt. Officials have said the debt stands at about $80bn for the government and its numerous state-linked companies known informally as Dubai Inc. Analysts say the number could be higher.

Convincing international lenders to provide fresh financing could alleviate some of the pressure on the once booming city-state, which has seen its core sectors of trade, tourism, financial services and real estate hit hard by the economic downturn.

Dubai earlier this year turned to the Emirates federal government in oil-rich Abu Dhabi for a $10bn bond issue that many observers regarded as a government bailout.

Dubai's ruler, Sheik Mohammed bin Rashid Al Maktoum, told reporters last month he is "not worried" when asked about the city-state's finances. Yet concerns remain.

A senior Middle East analyst at credit rating firm Standard & Poor's last week warned that a support fund Dubai created to help pay its debts has "insufficient" resources to cover the billions of dollars it has coming due, putting renewed pressure on the emirate to find additional cash.

Investors looking for assurances of Dubai's creditworthiness are eager to see if and how the sheikdom's state-owned developer Nakheel will repay a $3.5bn Islamic bond due in December.

The developer's parent company last week announced it shed 15% of staff as part of a broader reorganisation effort, leaving the company with fewer than 70 000 employees.

On Monday, MEED magazine reported that Nakheel repaid a separate bond worth $1.2bn on the same day the reorganisation was announced.

- AP