The recent announcement that Dubai World is restructuring part of its $80 billion debt has kept foreign press occupied over the last week and has cost a ban to The Times in the UAE. However, we believe that much of the story has not been told in its entire truthfulness, letting people believe this would have been the end of Dubai. In reality though the impact is minimal from a longer term perspective: world markets have already recovered from this hit and the drop in the Dubai market has mainly involved real estate companies. So should the world really be so worried? Or is it just newspapers that need to fill their daily columns?

The “standstill” request is not the end of Dubai. Other countries have gone through the same cycle and emerged in a better condition. In the 1980s, more than 50 countries (about 40 per cent of all nations that owed money to private foreign creditors) failed to pay in full on schedule, according to Michael Tomz of Stanford University and Mark L.J. Wright of the University of California, Los Angeles.

When thinking of the maritime industry, it seems the latter is the right answer, for no part of Dubai World has interests in shipping companies. But what about the rest of the market? A more open communication and a better structured reassurance from the government would be welcome, however this is just a crisis as the world has seen before: this is the low point in an economic cycle, not a point in a never ending fall, and this is the main thought on which we should focus.  A crisis gives many opportunities to investors who can benefit from the present low market.

A final thought on the international banks that lent to Dubai. They may have to swallow a bitter pill and agree to a restructuring in the total debt, however banks that loaned money to Dubai World cannot now claim to be victims of the emirate’s debt crisis because they are professional and should have understood the risks at the time of subscription.