What do global market experts say on the Dubai debt crisis?

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Adrian Mowat, Chief Asian and Emerging Equity Strategist, JP Morgan, says the Dubai debt crisis is a buying opportunity.

However, Patrick Shum of BMI Fund Management sees see further downside in markets. "In the near-term, we may see a further downside in the stock market, especially in the financial and banking sector." He feels the Dubai situation won't develop into a crisis as US and European countries will support the Dubai government.

On Wednesday, the Dubai government said it will ask creditors for a standstill on debt worth billions of dollars of two of its flagship firms --  Dubai World, which runs 49 ports around the world, and real estate developer Nakheel. Dubai World is the conglomerate which spearheaded the emirate's breakneck growth. It has USD 60 billion in liabilities and will seek a six-month standstill on its debts with all lenders. Nakheel was the builder of the famous three palm-shaped islands off the coast of Dubai.

Dubai's debt problem was known:

Mowat says holding of Dubai related debt is relatively modest in the global financial system. "People have been aware of the risks in these debts for over two years now. There is plenty of transparency on debt." He says the cash flow problems with these entities were known for quite sometime. "Professional investors in the bond market are fully aware of the risk."

Can the problem worsen?

Peter Canelo of Argus Institutional Partners says if Abu Dhabi does not step in then it could be a problem. "Abu Dhabi is going to come in and help fix the situation. They are going to come in and re-negotiate these loans and the terms of these loans. If Abu Dhabi does not do that, then we have a problem."