Sheikh Ahmed bin Saeed al-Maktoum.
Dubai is not currently in negotiations with Abu Dhabi to refinance $20 billion of crisis-related debt that will come due in 2014, a top Dubai official said on Tuesday.
As its real estate market crashed and state-linked companies struggled with their debt in 2009, Dubai borrowed a total of $20 billion from Abu Dhabi and the federal government of the United Arab Emirates.
This comprised $10 billion from the UAE central bank and $5 billion each from two state-owned banks in Abu Dhabi, National Bank of Abu Dhabi and Al Hilal Bank. The central bank debt is due to mature in February 2014, and the commercial bank debt in November 2014.
“Dubai companies are doing well and can take care of their own debt,” Sheikh Ahmed bin Saeed al-Maktoum, chairman of Dubai’s supreme fiscal committee and uncle of Dubai’s ruler, told reporters.
Asked if the two parties were holding discussions to refinance the Abu Dhabi debt, he said, “No, we are not talking to Abu Dhabi.” He did not elaborate.
Debt market analysts believe Abu Dhabi may quietly roll over the debt if Dubai is not ready to pay it back next year.