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Press Release

Dial-in Details for 11AM GMT/3PM Dubai Teleconference To Discuss Rating Actions Below

DUBAI, March 17, 2009--Standard & Poor's Ratings Services today said it had lowered its ratings on six Dubai-based government-related entities (GREs) by one notch. The 'A+' ratings on DIFC Investments LLC, DP World Ltd., Jebel Ali Free Zone (FZE), and JAFZ Sukuk Ltd. were lowered to 'A', and the 'A-1' short-term ratings were affirmed. The 'A/A-1' ratings on Dubai Multi Commodities Centre Authority were lowered to 'A-/A-2', while the 'A+' long-term rating on Dubai Holding Commercial Operations Group LLC (DHCOG) was also lowered to 'A'. The outlook on all entities remains negative. (A separate research update for each of the entities will follow.)

Thee ratings on the GREs reflect both their individual stand-alone credit profiles and our expectation that the United Arab Emirates (UAE; unrated) federal government, backed by its largest constituent, the Emirate of Abu Dhabi (AA/Stable/A-1+), will continue to provide, as and when the need arises, financial support to the Dubai government, which owns the rated GREs.

"The downgrades primarily reflect the ongoing impact on the GREs of the deterioration in Dubai's economic fundamentals since the last quarter of 2008, as the global economic downturn continues to depress some of Dubai's key economic sectors, including trade, tourism, and commerce," Standard & Poor's credit analyst Farouk Soussa said. "Demand in the all-important real estate sector also continues to show clear signs of having abated, with indications that a sharp correction in the real estate market, and an associated contraction in development and construction, is currently underway. We expect that as a result of these factors, the economy may contract in 2009, although quantifying this contraction is made difficult given the lack of timely national accounts data."

The deterioration in global liquidity has also presented challenges to the Dubai government and its GREs, but our view remains that these challenges are being managed effectively by the authorities. We note, in particular, the government's success in securing medium-term financing through the issuance of a $10 billion bond fully subscribed to by the Central Bank of the UAE, and the likelihood that a further $10 billion will be placed with the central bank should the need arise. In our view, the placement of this bond eases concerns regarding the Dubai government's ability to support the otherwise onerous refinancing requirements of its GREs in 2009, which we estimate to be in excess of $10 billion for the remainder of the year.

The central bank's subscription to the bond on favorable terms also underlines our fundamental expectation that the Dubai government and its entities will benefit from the support of the UAE federal government if the need arises, backed by the significant oil resources of Abu Dhabi. Finally, the Dubai government has, through a Department of Finance communiqué of Feb. 25, 2009, articulated its commitment to supporting its GREs and its intention to use the proceeds of the bond sale to ease financing requirements as the need arises, which we consider to be a key underpinning to the ratings on the GREs at the current level. The near-term challenges faced by the Dubai authorities are substantial, however. Dubai is a small, open economy and can do little to shield its key sectors from the impact of a fall in external demand in the coming months, and the policy response to the domestic economic fallout will be key to future ratings actions on Dubai's GREs.

The negative outlook on the six GREs indicates the likelihood of downgrades if their flexibility is further impaired by the difficult economic environment.

"The ratings could also be lowered if indications arise that the government of Dubai's willingness and/or ability to support its GREs is weaker than what we currently anticipate, or if the willingness and/or ability of the UAE federal government, backed by Abu Dhabi, to provide ultimate support to the Dubai government diminishes," Mr. Soussa said. "If the GREs are able to adjust to a lower-growth environment relatively smoothly, the ratings are likely to stay at the current level."

S&P TELECONFERENCE

Standard & Poor's will host a telephone conference call for investors and the media on Tuesday, March 17, 2009, at 11:00 am London time/3:00 p.m. Dubai time to discuss these rating actions.

The sovereign and corporate credit analysts participating in this call will include: Farouk Soussa, Alf Stenqvist, Christian Esters, Andreas Kindahl and Karim Nassif. The call will be moderated by Jan Willem Plantagie, S&P Regional Manager for the Middle East.

Please note the focus of this teleconference will be on the impact of the deterioration in Dubai's economic fundamentals since the last quarter of 2008 on its key corporate sectors. The analysts will not be addressing specific questions on regional banks.

After their initial remarks, the speakers will be available to answer your questions.

Live Dial-in Numbers:
UAE Free Call: 8000 440 189
UK Local Call: 0844 493 3800
All Other International: +44 (0) 1452 555 566

Conference ID Number: 90731557
The call will begin promptly at the time indicated. Please call at least 15 minutes before the scheduled start of the call to complete the pre-call registration process.

Replay numbers:

Recorded replays of the call will be available about an hour after the call concludes until midnight on March 30, 2009.

UK Local Call: 0845 245 5205
All Other International: +44 (0) 1452 55 00 00
Replay Access Number: 90731557#

Analyst contacts:
Farouk Soussa, PhD., Dubai,
Alf Stenqvist, Stockholm
Alexandre de Lestrange, Paris
Andreas Kindahl, Stockholm
Christian Esters, CFA, Frankfurt