National debt, regional investors and gold news
Dubai’s current debt obligations are estimated at $48 billion for 2014 to 2016. But they aren’t a cause for concern according to Masood Ahmed, director of the IMF’s Middle East and Central Asia, who told reporters yesterday that the emirate had ‘alternative’ plans in place for repayments if asset sales did not meet the required levels. Debts in Dubai are relatively high – at 100% of GDP. The Institute of International Finance has also warned that although the UAE’s economy is in recovery, investors need to maintain a cautious approach. Read more here
Many new investment projects in the UAE will be financed by cash loaned from banks in Qatar, reports announce. As the Middle East’s biggest lender, more and more UAE companies are experiencing growth due to money lent by Qatari banks. Most recently, Qatar National Bank and Commercial Bank International revealed it had leant $350 million to Air Arabia which hopes to purchase 10 new Airbus A320’s. Find out more.
Gold hedging its future?
Petropavlovsk (the london listed gold producer) will pre-sell 55% of its future output for 2014, which means it is the first big producer to hedge more than half its future sales. The gold market is currently in precarious state with country reserve sell-offs forcing prices to fall below previously predicted levels. Industry experts have warned that hedging and selling gold forward caused gold prices to crash in the 1990s. Prices are set to fall further, but the future for gold investments remains uncertain. For more information, read here.