Dubai working with HSBC on $7bn financing for Expo 2020
Dubai is working with HSBC on the financing of Expo 2020 Dubai, a $7 billion exhibition centre project expected to attract 25 million visitors, sources familiar with the matter said. The site will host Expo Dubai which will run from October 2020 to April 2021 and will be the first World Expo hosted in the Middle East, according to the Expo 2020 website.
The project provides more evidence that Dubai is back in expansion mode after running into trouble during the 2009 global financial crisis. The expo is a major part of Dubai’s plans to expand its infrastructure and boost its credentials as a tourist destination. The financing will come from bank loans and from various export credit agencies, the sources said. HSBC has been appointed to coordinate the export credit agencies and financing supported by them, the sources said, adding that the split between the commercial loans and the export credit financing was yet to be defined.
Export credit-backed financing provides guarantees that support the export and supply of domestic goods or contractors or in some cases direct lending. Expo 2020 Dubai was not immediately available to comment. HSBC declined to comment.
The exhibition centre project, in the Dubai South district, situated midway between Abu Dhabi and Dubai, will be 4 kilometres long and 1.8 kilometres wide, according to its website. The development will include a number of infrastructure projects, an exhibition centre, academic and research institutions and a technology cluster, the website said. It will possibly also need additional funding on top of the $7 billion for projects linked to the event and led by government entities such as Dubai Municipality, the Dubai Electricity and Water Authority, and Dubai’s Roads and Transport Authority, two of the sources said.
The expo site is located near Dubai’s new airport, Al-Maktoum International Airport. There are proposals for a $3 billion expansion of the airport and HSBC is also advising the government on the financing for this project. — Reuters