IslamicFinance.de

Banks in the United Arab Emirates are working together to try to stem the number of small business owners fleeing the country with unpaid debt, a trend that has already reached around 5 billion dirhams ($1.4 bln) this year, a senior banking official said. Small and medium-sized enterprises have come under pressure in recent months amid a gradual drying up of liquidity in the banking system due to the weak oil price and slowing economic growth. As a result, some business people have chosen to "skip" the country, leaving behind unpaid debt, a situation that bankers say has grown significantly from last year, although they did not provide precise figures. In a country where under existing legislation, a bounced cheque risks landing the issuer in jail, many of those absconding fear the consequences if they stay. "We want to take coordinated action on risk management," UAE Banks Federation chairman Abdul Aziz al-Ghurair told reporters on the sidelines of a banking conference