Is Dubai facing another debt crisis?

Efforts to contain the coronavirus will cause Dubai’s economy to contract sharply, exacerbating overcapacity in key sectors and making it more difficult for the Emirate’s government-related entities (GREs) to service their large debts. Our own database shows that these debts have risen to more than 80% of the Emirate’s GDP. We think that Abu Dhabi would, ultimately, step in with another bailout. But a risk of a repeat of the events of 2009, when support was slow to arrive, is high. That would make the financial market and economic fallout much worse.
James Swanston Middle East and North Africa Economist
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Middle East Economics Update

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Bahrain COVID-19 surge, Oman strikes, OPEC+ meeting

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Strong vaccine rollouts in the Gulf and Morocco have allowed for an easing of travel-related restrictions but there is still a long way to go and recoveries in tourism sectors are likely to be slow-going. And in the rest of the region, struggling vaccination programmes will further delay the re-opening of tourism sectors.

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