The Dubai government's reluctance to shore up state-owned companies if in financial difficulty has led international agencies to downgrade the credit rating of SmartCity Malta's parent company.
The Dubai holding company that owns SmartCity Malta and telecommunications company Go had its credit rating lowered over the past week even though it is the personal investment arm of the emirate's ruler Sheikh Mohammed bin Rashid al-Maktoum.
International credit rating agencies are not making a distinction between companies owned by the Dubai government and others personally owned by the emirate's ruler.
Last week, Investments Minister Austin Gatt told Parliament there was no relation between Dubai World, which announced a moratorium on debt repayments, and Dubai Holding, the company that owns SmartCity Malta and Go plc. He said Dubai World was owned by the Dubai government while Dubai Holding was the personal property of the sheikh.
However, the distinction is not being made by credit rating agencies and financial analysts.
Standard & Poors, Moody's and Fitsch have downgraded the credit rating of Dubai Holding amid concerns it could be the next state-related entity to default on its debt.
Bankers talking to the Financial Times said the company's direct connection with the sheik gave it a stronger political standing.
The turmoil in the Persian Gulf's tiny emirate is of concern to Malta given Dubai's commercial interests in three major companies, two of them listed on the stock exchange.
Sama Dubai and Tecom Investments, subsidiaries of Dubai Holding, have a joint 91 per cent shareholding in SmartCity Malta. The rest of the shareholding belongs to the government.
Tecom Investments and Emirates International Communications, a subsidiary of Dubai Investment Group, hold 60 per cent of shares in listed company Go.
The third Maltese company with Dubai-related investment is Corinthia's International Hotel Investments.
IHI, listed on the stock exchange, is part-owned by Nakheel Hotels, a subsidiary of Dubai World's Nakheel.
Nakheel is unrelated to the companies that own SmartCity Malta and Go except for the fact that the ultimate owner of all companies is Dubai's Sheik al-Maktoum.
Government-owned Dubai World shocked financial markets two weeks ago when it asked for a moratorium on debt payments totalling $50 billion.
Investors were further put on edge when the head of the Dubai Finance Department said the government never intended to guarantee Dubai World's debt.