The word on the street is that banks in the UAE have faired rather well amid the aftershocks of the global financial crisis. Considering they weren’t hit as hard as American, European and Asian markets, Emirati bankers seem quite happy with themselves. Yet, when your government directly injects over $20 billion into local banks to replace funding that has gone abroad and sets up another $14 billion emergency facility, you’re in trouble. If the UAE banking sector was strong enough to recover these funds alone, they would not have needed their affluent government to pump such large amounts of liquidity into their banks. And if it was not for the existence of such a wealthy government, no such back up would have been possible in the first place. With plummeting oil prices, the burst of the real estate bubble — too much supply and nose-diving demand — decreasing business tourism
