UAE ruler cancels debts of defaulting borrowers

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Citizens of the oil-rich United Arab Emirates who defaulted on hundreds of thousands of dollars in loans could soon see their debts wiped away.

State news agency WAM reported Sunday that the president of the Gulf federation is ordering the settlement of personal debts of up to 5 million dirhams ($1.4 million) for citizens in default.

The order by Sheik Khalifa bin Zayed Al Nahyan covers citizens detained for unpaid debts and those whose cases are still being reviewed. Debtors in the Emirates face imprisonment while in default.

Emirati leaders periodically cancel debts of citizens. A similar debt forgiveness order in January covered thousands of Emiratis owing up to 1 million dirhams ($272,480) apiece.

The writeoffs are the latest government perks introduced in the wake of the Arab Spring uprisings.