Nakheel, the developer owned by Dubai World, will receive $8bn in cash from the Dubai government, taking the total support to $9.2 bn, and enabling the company to repay contactors and complete projects.

“The government of Dubai, through the Dubai Financial Support Fund will commit to providing approximately $8bn of new money directly to Nakheel to fund operations and settle liabilities,” Nakheel said. The support fund “proposed to convert its existing $1.2bn debt claim in Nakheel into equity.”

Support from the government is conditional upon agreement with the creditors on its recapitalization plan, Nakheel said. The company will get an initial $1.5bn from the fund to pay contractors to continue building near-term projects.