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Dubai Names $20B Fund Chmn; Plans Loans For State Cos |
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08.13.2009 |
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Dubai named Wednesday a chairman to head a special $20 billion fund set up last month to support its embattled economy and said it will loan money to struggling state companies and projects in the sheikdom.
Abdulrahman Al Saleh, director general of Dubai's Department of Finance will chair the $20 billion fund, known as the Dubai Financial Support Fund, while Abdulaziz Rahmah Al Muhairi, managing director of the Investment Corporation of Dubai will act as deputy chairman, the Department of Finance said in an emailed statement Wednesday.
The United Arab Emirates central bank based in oil-rich Abu Dhabi provided the first $10 billion for the fund earlier this year by subscribing to bonds issued by Dubai in a form of economic bailout for the emirate.
The sheikhdom needs to raise the second $10 billion tranche for the fund this year to help revive its economy that has also suffered from a near 50% drop in property prices in a year and a reluctance of international banks to lend it anymore money. Dubai has said it owes about $80 billion including loans to government companies.
Mattar Mohammed Al Tayer, chairman of Dubai's Roads and Transport Authority, Majid Saif Al Ghurair, chairman of Shuaa Capital and Riad Mohammed Khalfan Belhoul, legal counsel will also act as board members, according to the statement Wednesday.
LOANS, PROJECTS
The board's main duties will include setting the criteria for assessing loan applications by the Dubai government and the emirate's government-related entities that need cash. It will also nominate projects that need to be financially supported.
"The loans will be made on a commercial basis, and it will be up to each recipient of the financial support whether to disclose the extent of its borrowing from the Support Fund," Marwan Iqbal Abedin, who has been appointed as executive director of the fund said in the statement.
The fund will be able to issue financial instruments, including bonds and sukuks, inside and outside of Dubai, invest in commercial projects and establish investment funds. It will also be able to acquire partial or whole stakes in institutions and companies.
Al Saleh replaced Nasser Al Shaikh as head of Dubai's Department of Finance in May after he unexpectedly resigned.
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Source:www.online.wsj.com |
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