The government of Abu-Dhabi on Monday provided a $10 billion loan to neighboring Dubai, to save a state-run property company from a looming debt crisis.
Dubai World, a conglomerate with interests in financial services and property, asked in late November for repayment of its $60 billion debt burden to be suspended for six months. The news triggered stock market declines in several countries.
The last-minute bailout will allow PJSC, the property division of state-owned Dubai World, to pay $4.1 billion due on Monday to bondholders.
The remainder of the funds provided by Abu Dhabi will be used to repay debts to Dubai World's trade creditors and contractors, cover interest expenses, and pay wage bills to the conglomerate's personnel.
European stocks rose in early trade on Monday as Dubai debt fears eased, with banks leading the growth.
DUBAI, December 14 (RIA Novosti)
