Dubai set to issue bond to refinance maturing debt

Dubai plans to issue a bond to refinance part of Dh6.5 billion ($1.8 billion) of sovereign debt maturing in April 2013, its finance chief was quoted as saying by a newspaper on Monday.
Abdulrahman Al Saleh, director-general of the Dubai Department of Finance, did not discuss the size or timing of any new bond or give other details, and government officials were not available to confirm his comments.

The newspaper did not provide verbatim quotes from the interview and appeared to be paraphrasing Saleh’s remarks.

Saleh told Dubai TV in an interview: “In the past, we issued bonds to support the government’s financial strategy and finance infrastructure projects.

“In the coming period, we also have plans that need financial support in the airline industry, we have expansion plans for Dubai Airport and Al Maktoum (airport), and there is a need to refinance debt when it matures.” Saleh also told Dubai TV: “I confirm that we are under no pressure to issue bonds for emergency situations.”

Dubai last sold sovereign debt in April this year — a $1.25 billion, two-tranche Islamic bond aimed at covering its budget deficit and refinancing debt.

The trade-driven economy of Dubai is showing positive signs based on growth rates in various sectors during the first half of 2012, Saleh was also quoted as saying by the newspaper.

The UAE central bank said this month that Dubai might achieve gross domestic product growth of four per cent or more this year. “The GDP growth is expected to reach four per cent this year and next year, we expect it to be more than four per cent,” Saleh told Dubai TV. —

(Reuters),18 September 2012