Dubai repays $500m of dollar bonds

The 10-year notes were repaid as they were due to mature on Tuesday

The Dubai skyline. The aggregate net income on the top 10 listed lenders in the UAE registered a quarterly increase of about 85 per cent in the first three months of this year. Reem Mohammed / The NationalShow less

The government of Dubai repaid $500 million of US dollar-denominated bonds that had been issued under its Euro Medium Term Note Programme.

The fixed-rate notes were first issued 10 years ago and have been paid in full as they became due on Tuesday.

"The Government of Dubai’s ability to fulfill its financial obligations reflects its deep fiscal stability amidst the circumstances imposed by the current global crisis," Saleh Al Saleh, director general of Dubai's Department of Finance said in a statement.

"The government's solvency has allowed it to fulfill its past and current obligations and will continue to enable it to meet all future obligations on time."

The Dubai government, which does not have a sovereign rating, has issued five separate stimulus packages since the onset of the pandemic totalling about Dh7.1 billion ($1.9bn).

The emirate has also taken various other measures to support local businesses.

Earlier this month, Dubai Crown Prince and chairman of the Executive Council, Sheikh Hamdan Bin Mohammed, instructed government departments to reduce the administrative hurdles faced by businesses by 30 per cent in a bid to help them cut overheads.

Dubai, the region's commercial and trading hub, relies far less on oil compared to its peers in the region, Moody's said on Monday in a report that highlighted the significance of hydrocarbon revenues to the region's economies. Oil and gas revenue contributes "less than 2 per cent" to the emirate's gross domestic product and oil-related revenue only makes up 7 per cent of total government revenue, the ratings agency said.

"We have been successful in overcoming the most challenging repercussions of the global pandemic and have now entered a solid phase of recovery, thanks to the measures taken by the government to ensure rational prioritised spending, under the directives of our leadership," Mr Al Saleh said.