>SKYSCRAPERS & ECONOMIC CRISIS: IS THERE A LINK?

Dubai World, with $59 billion of liabilities, is seeking to delay debt payments, sending contracts to protect the emirate against default surging by the most since they began trading in January. The state controlled company will ask all creditors for a standstill agreement as it negotiates to extend maturities, including $3.52 billion of Islamic bonds due on Dec. 14 from its property unit Nakheel PJSC, the builder of palm tree-shaped islands. Extending the maturity of Nakheel debt is feeding the market’s uncertainty on which debt Dubai will honour in full. They look desperate and the market is concerned that in the long term Dubai's indebtedness is rising not falling. Dubai accumulated $80 billion of debt by expanding in banking, real estate and transportation before credit markets seized up last year

Bond Program- Dubai, the second biggest of seven sheikhdoms that make up the United Arab Emirates and home to the world’s tallest tower and the biggest man-made islands, suffered the world’s steepest property slump in the global credit crisis as home prices fell 50 percent from their 2008 peak. The central bank, headquartered in Abu Dhabi, bought all of the 4 percent, five -securities that Dubai sold on Feb. 23. Dubai’s ruler said, Nov. 9 the emirate’s bond program to raise a further $10 billion. Abu Dhabi, the U.A.E.’s capital, is owner of the world’s biggest sovereign wealth fund and holds almost all of its oil.

Repayment Schedule- Sheikh Mohammed last week removed the chairman of Dubai holding LLC and Dubai World, two large statestate-owned business groups, as well as the head of U.A.E.’s biggest developer Emaar Properties PJSC from the board of the Investment Corp. of Dubai the emirate’s main holding company. He also ejected the governor of the Dubai International financial Centre, Omar Bin Sulaiman, who had led efforts to transform Dubai into the Middle East finance hub.

To read the full report: ECONOMETER