Dubai fallout unlikely to trigger global crisis: trade agency

SEOUL, Nov. 30 (Yonhap) -- The debt crisis in Dubai is worrisome, but unlikely to
spread around the world because the global financial system can contain the Dubai
fallout, South Korea's government trade agency said Monday.

The announcement on Wednesday that Dubai's business conglomerate, Dubai World,
had called for a repayment moratorium on US$60 billion in debt has sent
shockwaves through global financial markets.
Concern was initially high among investors that the crisis in once-booming Dubai
could spark defaults in other parts of the United Arab Emirates and derail a
fragile recovery of the global economy.
"Given the size of the default and coordinated countermeasures by governments
around the world, the possibility that the Dubai shock could grow into a second
global economic crisis is very low," the Korea Trade and Investment Promotion
Agency said in a report.
But the agency warned the Dubai woe would prompt emerging markets to shrink,
advising the Korean government to take measures to absorb such fallout.
Earlier in the day, the nation's Ministry of Strategy and Finance said the impact
of the Dubai crisis on South Korea was "limited" because of its small debt
exposure to Dubai.
Officials at the ministry and financial regulators, however, said they will
closely monitor market situations and take action if necessary.
(END)