The government of Dubai is on track to create capacity for additional sovereign borrowing to finance World Expo 2020 projects, according to a report issued by BofA Merrill Lynch this week.
“The bulk of the Expo 2020-related capex is set to take place in 2016-20,” the report says. “Fiscal room to accommodate the additional spending without jeopardising debt dynamics could have sensibly increased by that time, if the Dubai government remains prudent.”
BofA Merrill Lynch said that Dubai’s debt “appears to be stabilising”. It estimated Dubai government debt at $54.8bn now compared with $50.5bn a year ago.
Dubai has announced it will invest $7bn in projects and infrastructure for the World Expo, which opens in October 2020.
A total of 25 million people are forecast to visit the World Expo 2020 site in the six months that it will be open.