Possible Dubai Hidden Minefields

UBS analysts are raising the possibility that Dubai may have offshore debt in excess of the $80 billion to $90 billion known to exist.

Simon Kennedy at Marketwatch reports, on the UBS breakdown:

Analysts at UBS said authorities will not have taken the decision to restructure Dubai World lightly and that there are three potential explanations for the decision. Firstly, UBS said, Abu Dhabi's support for Dubai might be less generous than assumed. "Perhaps Abu Dhabi has forced Dubai to tackle the problem of excessive corporate debt 'in-house' first before extending more financial support," the broker said. A second possibility is that corporate-sector problems might be more severe than assumed, UBS said. Thirdly, Dubai's debt might be higher than the generally assumed $80 billion to $90 billion due to potential off-balance sheet liabilities, it added