Mon, November 30, 2009
Business > Markets > Dubai debt crisis

China State Construction says not exposed to Dubai debt crisis

2009-11-28 08:57:55 GMT2009-11-28 16:57:55 (Beijing Time)  Xinhua English

BEIJING, Nov. 28 (Xinhua) -- China State Construction Engineering Corp. (CSCEC), the largest contractor in China, said Saturday that it had "no business relations" with the troubled Dubai World and its business in the Emirate would not be affected.

This followed share price falls in response to media reports that claimed the company contracted many major projects in Dubai and its business would be influenced after the default of Dubai World, the Emirate's leading state-owned company.

CSCEC's shares on the Shanghai bourse declined 2.64 percent to 4.79 yuan (0.7 U.S. dollars) Friday. China State Construction International, a Hong Kong-listed unit of CSCEC, plunged 7.02 percent to 3.18 Hong Kong dollars on the Hong Kong Stock Exchange.

Dubai said on Wednesday it was asking for a six-month reprieve on paying Dubai World's debts as a first step to restructuring the company.

Dubai World said it would ask creditors to agree to a standstill on 60 billion U.S. dollars of debt until at least May.

Market observers noted if Dubai should prove unable to pay the debts, many of the world's leading banks will suffer losses.

China's three leading banks -- the Industrial and Commercial Bank of China, Bank of China and Bank of Communications, said Friday that they did not hold bonds issued by Dubai World.

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