DUBAI: The government of Dubai unveiled a support fund on Wednesday to manage proceeds from its $20 billion government bond program, aimed at supporting the emirate’s economic growth plans.
The new entity, Dubai Financial Support Fund (DFSF), will manage the distribution of government-provided funds to aid government-related entities on a commercial basis.
State news agency WAM said that Sheikh Mohammad Bin Rashid Al-Maktoum, vice president and prime minister of the UAE and ruler of Dubai, has issued a Decree launching the Dubai Financial Support Fund.
Abdul Rahman Al-Saleh, director-general of the Department of Finance said the fund would “provide loans on a commercial basis to government and government related entities engaged in projects deemed to be of strategic and developmental importance to the emirate of Dubai. Each application for support will be assessed against predetermined criteria to ensure the funds are allocated efficiently and in accordance with Dubai’s long-term growth strategy.”
Dubai launched the $20 billion sovereign bond program last February to help state-linked firms.
The first $10 billion tranche was sold to the UAE central bank. The support fund can issue financial instruments, including bonds, inside and outside the emirate on behalf of the government of Dubai, invest in commercial projects, establish investment funds and manage institutions and corporations in order to provide liquidity for strategic projects of entities applying for funds.The fund can also acquire partial or whole stakes in institutions and companies that are deemed to be in line with the overall strategic objectives of establishing it.
The support fund’s board will be responsible for establishing general policy for the fund and its subsidiaries and defining its projects and programs, obtaining loans and financing, establishing institutions, companies, commercial projects and subsidiaries and buying and selling assets and equities. It will also be responsible for recommending criteria for applicants requesting loans and proposing suitable applicants in the form of strategic projects or companies and recommending them to SFC.
The SFC is chaired by Sheikh Ahmad Bin Saeed Al-Maktoum, chairman of Dubai Civil Aviation Authority and chairman and CEO of Emirates Group, and has the following board members: Mohammad Al-Shaibani, deputy chairman of the SFC and chief executive officer of Investment Corporation of Dubai; Abdul Rahman Al-Saleh, director general of the Dubai Department of Finance; Abdulaziz Al-Muhairi, managing director of Investment Corporation of Dubai; and Omar Bin Sulaiman, governor of Dubai International Financial Center.
