Dubai royal: Phased payments beneficial for all

Sheikh Maktoum said the Dubai World restructuring did not indicate that Dubai's economy was in trouble

HH Sheikh Maktoum Hasher Maktoum Al Maktoum, CEO of Al Fajer Properties and the nephew of UAE prime minister and ruler of Dubai HH Sheikh Mohammed bin Rashid Al Maktoum, has said that it “didn’t make sense” for anyone, including businessmen, investors and shareholders, if Dubai was to pay off all its debts in one go.

The comments were in answer to architectural firm FXFowle’s director Steven Miller, who asked when government companies would pay up in full money owed to international firms operating in the country.

“Everything needs to be paced out or it won’t help anyone,” he said, speaking at the Arabian Business Conference in Dubai.

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He also said that Dubai’s debt was a drop in the ocean when compared to debts of other countries in the world. “Dubai’s debt in its entirety, is equivalent to the debts of a single US or European bank, but just because it’s Dubai, it makes headlines.”

Sheikh Maktoum also drew attention to the fact that Dubai World’s debts were not to be confused with the country’s debts. “We have one of the biggest sovereign wealth funds in the world, so just because an entity that is owned by the government, but is in fact a separate entity on its own, has chosen to restructure its debt, it doesn’t mean the economy is in trouble. Dubai can and will pay off its debts – it just doesn’t have to be all in one go,” he told Construction Week on the sidelines of the conference.

With regards to Dubai World communicating its request for restructuring repayments, Sheikh Maktoum agreed it was “not the best.”

“Obviously, everyone learns from their mistakes and I’m sure things will only get better from here on. The timing of the announcement may not have been the best, but this is something that has already been accepted and I’m sure a note of it has been made by everyone concerned,” he said.

He estimated that the recovery would begin sometime in 2012.

Check back on Saturday for full interview with Sheikh Maktoum