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Given the scale of the fallout across international financial markets, it is a matter of time that the markets in the Gulf region may be affected, albeit to varying degrees. Such a situation could only be dealt with swiftly, methodologically, and taking into consideration the long-term consequences.
The UAE Central Bank recently announced a Dh50 billion emergency funding facility for banks to address the shortage of funds available in the market. In addition, the authority said in a statement that additional resources would be facilitated "for providing further support to banks operating in the UAE if required".
The move is necessitated by the dramatic changes unfolding in the international financial markets and the withdrawal of some foreign funds from the local stock market. Hence, the step taken by the Central Bank is welcomed as necessary and timely.
But given that markets could fluctuate, it is critical that the Central Bank and the financial authorities keep the public informed, updated, and ensured of any changes that are taking place in the business environment. Only a transparent and open approach would ensure the effectiveness of any proposed safety measure.
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