The Dubai government, nearing bankruptcy since the property boom that has driven its growth hit the wall, is heading to the bond markets to try to raise $20 billion (£13.7 billion) to pay down a big chunk of debt due this year.

Dubai, part of the United Arab Emirates federation, has little oil revenue, and its economy has been propelled by the property boom for the past six years. But that was one of the first casualties of the global financial crisis and now Dubai, home to 100,000 British expatriates, is in tatters.

The UAE says the first $10 billion tranche of the bond issue was fully subscribed by the federation's central bank, and the bond will provide Dubai "with the necessary liquidity to substitute the liquidity that has dried up globally in the last 12 months and accordingly meet all upcoming financial obligations".

The bond will be unsecured, fixed-rate paper, yielding 4% a year, with a five-year maturity.Thousands of UK workers went to Dubai during the boom but many have lost their jobs.