Kuwait, Other Mideast Nations to Seek Western Bank Funding

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Kuwait, Other Mideast Nations to Seek Western Bank Funding

LONDON -- Led by Kuwait, various Middle East nations are preparing to tap Western banks and financial markets for funding to help rebuild their war-ravaged region.

Kuwait said it wants to borrow $33 billion on world money markets to rebuild its economy, which was devastated during seven months of Iraqi occupation.

The Emir's Decree

A decree published Monday by the emir, Sheik Jaber Ahmed Sabah, instructed the Kuwait Finance Ministry to obtain loans "in various international financial markets."

This will be the biggest Mideast financing since Saudi Arabia this year raised $3.5 billion from an international banking group headed by J.P. Morgan & Co. The funds were sought to supplement Saudi reserves, after the oil kingdom pledged $48 billion toward the Persian Gulf war effort.

London-based bankers indicated that Kuwait's financings will be coordinated in Britain by the Kuwait Investment Authority, which controls along with affiliates much of the oil state's $100 billion in foreign assets.

They expect Kuwait to pledge at least part of these foreign holdings, in Western stock and bond markets and in a number of major corporations, as collateral for the funding. Overseas assets include a 9.9% stake in British Petroleum PLC, Britain's big oil company, worth more than $3.5 billion.

Kuwait Airways Seeks Planes

Kuwait is also planning to rebuild its national aircraft fleet, bankers said. Kuwait Airways is seeking 20 European-made Airbus planes, in a package valued at up to $2. …