IMF welcomes UAE’s move to keep banks afloat

Washington, Nov 30 (DPA) The International Monetary Fund (IMF) said it welcomed the plan by the central bank of the United Arab Emirates (UAE) to supply liquidity to the country’s banks.

The move followed last week’s announcement by Dubai World, which is owned by the government of Dubai, that it would seek to delay payments on its debt. The news raised fears about the stability of financial institutions in the region.

“The United Arab Emirates is a strong resource-based economy, and we welcome today’s announcement by the central bank of the UAE making available to banks a special additional liquidity facility,” the IMF said in a statement late Sunday.

“We look forward to further clarification by the authorities towards a cooperative mechanism to address the issues between these debtors and their creditors.”

The Washington-based IMF said it was continuing to monitor the situation “following the unexpected announcement by the government of Dubai regarding a standstill on the debt of Dubai World and its Nakheel subsidiary, which has had an adverse impact on financial markets.”