Unified GCC Currency May Come by 2010
13/Mar/2008
Arab News
Assistant Secretary-General for Economic Affairs at the Arab League Dr. Mohammed Ibrahim Al-Tuwaijri has dismissed the idea that any GCC state, except Kuwait, would cut its currency link with the US dollar. He said there were reports the dollar might recover by March 2009. Talking on the sidelines of the regional meet on GCC policies for using clean fuel for cleaner environment Al-Tuwaijri said it was not in the interest of GCC states to cut their currency link with the dollar since this might lead to chaos, especially since all deals and transactions were in carried out in dollars.
Regarding the unified GCC currency, he said all the recent indications showed it would be issued by 2010 in view of the international economic situation such as inflation and recession in the US dollar that reflected negatively on GCC currencies linked to it. He added the introduction of a unified GCC currency would be one of positive resolutions to better the economic situation. Minister of Oil and Gas and Head of the National Oil and Gas Authority Dr. Abdulhussain ibn Ali Mirza, who opened the regional meet on developing GCC policies to use cleaner fuel for better environment, said: “Bahrain has become the first country in the region to produce low Suplphur Diesel and also jet fuel with less CO2 omissions.”
The two-day meeting will discuss issues related to fuel and cars and what has been achieved by the GCC, Middle East and North African countries to improve the quality of fuel through setting standards for vehicles in view of the challenges facing the production of unleaded fuel. The minister said that international efforts and cooperation was essential to improve the international power scenario including the oil sector to maintain environment through improving petroleum products.
Mirza mentioned a number of projects in the field, including unleaded fuel, which has been produced since 2000 at a cost of $7.4 million. Prime Minister Shaikh Khalifa ibn Salman Al- Khalifa in December opened a complex to produce unleaded diesel at a cost of $725 million with investment revenue reaching 30 percent.
“There are a number of similar projects of international standards to maintain environment which would be launched after completing their technical and financial studies.” The Director and Regional Representative of the UN Environment Program for West Asia Dr. Habeeb Al-Hobar said an international partnership was essential to tackle the issue.
He hailed the role of international partnership in using natural resources wisely and also the use of cleaner fuel under the sponsorship of the un environment program which, he said, contributed in spreading the use of unleaded fuel. He also praised the policies and programs of Arab countries to achieve a cleaner environment, underlining the ability of the GCC states to use unleaded fuel since 2003 in Saudi Arabia, Kuwait and the UAE.
Deputy Chairman of the general committee to protect fishery resources, environment and wildlife Dr. Ismael Al-Madani referred to the increasing number of cars in Bahrain with about nine percent considered as dangerous from the point of view of traffic and leading to accidents and deaths.
Tuesday, March 18, 2008
GCC common currency dollar peg dilemma
GCC common currency dollar peg dilemma
By Nadim Kawach on Sunday, March 16 , 2008
Gulf countries are debating whether to peg the single common currency, which is likely to be launched in 2010, to the US dollar, a senior Gulf economy official said.
Abdul Aziz Al Owaishiq, Director of the GCC Economic Integration Department, told Qatar’s Arabic language daily Al Raya that a debate within the GCC is on to decide whether to peg the planned common currency to the US dollar.
The Gulf Co-operation Council (GCC) countries, which control more than 45 per cent of the world’s oil wealth, are sticking to their original 2010 deadline to set up the currency union despite Oman’s decision to suspend its participation.
Owaishiq said GCC monetary authorities have not taken any decision yet on the link between the planned common Gulf currency and the dollar, adding it would be up to the GCC heads of state to decide on this issue.
“I would like to note that the Supreme Council has empowered the GCC monetary authority to decide on whether to peg the common currency to one or more currencies or float this currency, depending on the requirements and conditions of the coming stage.”
Owaishiq said the GCC monetary union would accelerate growth in member states. “I can tell you that pegging the GCC currencies to the US dollar does not necessarily mean their exchange rate cannot be changed against the dollar while keeping that peg,” he said.
“I believe if the change in this rate by the GCC countries is by the same percentage, then this will not affect the arrangements for the monetary union because the GCC’s proportionate exchange rates will remain fixed,” he added. GCC states have decided to keep their currencies linked to the US dollar as they pursue plans to create a landmark monetary union following the launching of the common market early this year and the customs union four years ago.
Kuwait, which had its dinar pegged to a basket of currencies for more than two decades, joined the peg two years ago before it decided to revert to the basket, in which the US dollar is believed to account for 80 per cent. Speculation has mounted over the past few months that some GCC states will appreciate their currencies against the dollar while keeping the peg in a bid to curb inflation that has surged to double-digit rates in some member economies.
“The currency union timetable is still on track for 2010. It is a decision by the GCC Supreme Council (heads of state),” he said.
Commenting on revaluation, he said a possible decision by Gulf Arab states to revalue their currencies against the weakening US dollar will not block their plans to create the Middle East’s first monetary union.
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Last Update at 10:09 pm on March 16, 2008
By Nadim Kawach on Sunday, March 16 , 2008
Gulf countries are debating whether to peg the single common currency, which is likely to be launched in 2010, to the US dollar, a senior Gulf economy official said.
Abdul Aziz Al Owaishiq, Director of the GCC Economic Integration Department, told Qatar’s Arabic language daily Al Raya that a debate within the GCC is on to decide whether to peg the planned common currency to the US dollar.
The Gulf Co-operation Council (GCC) countries, which control more than 45 per cent of the world’s oil wealth, are sticking to their original 2010 deadline to set up the currency union despite Oman’s decision to suspend its participation.
Owaishiq said GCC monetary authorities have not taken any decision yet on the link between the planned common Gulf currency and the dollar, adding it would be up to the GCC heads of state to decide on this issue.
“I would like to note that the Supreme Council has empowered the GCC monetary authority to decide on whether to peg the common currency to one or more currencies or float this currency, depending on the requirements and conditions of the coming stage.”
Owaishiq said the GCC monetary union would accelerate growth in member states. “I can tell you that pegging the GCC currencies to the US dollar does not necessarily mean their exchange rate cannot be changed against the dollar while keeping that peg,” he said.
“I believe if the change in this rate by the GCC countries is by the same percentage, then this will not affect the arrangements for the monetary union because the GCC’s proportionate exchange rates will remain fixed,” he added. GCC states have decided to keep their currencies linked to the US dollar as they pursue plans to create a landmark monetary union following the launching of the common market early this year and the customs union four years ago.
Kuwait, which had its dinar pegged to a basket of currencies for more than two decades, joined the peg two years ago before it decided to revert to the basket, in which the US dollar is believed to account for 80 per cent. Speculation has mounted over the past few months that some GCC states will appreciate their currencies against the dollar while keeping the peg in a bid to curb inflation that has surged to double-digit rates in some member economies.
“The currency union timetable is still on track for 2010. It is a decision by the GCC Supreme Council (heads of state),” he said.
Commenting on revaluation, he said a possible decision by Gulf Arab states to revalue their currencies against the weakening US dollar will not block their plans to create the Middle East’s first monetary union.
More in News
Saudi Telecom plans $15bn of acquisitions
Kuwait allows dinar to fall as dollar recovers
China reports new bird flu outbreak
Airbus A380 takes off for inaugural London service
World markets jittery ahead of Fed decision
UAE markets feel the heat as global equities slump
Capital offers huge scope for growth of exhibition industry
Dubai World buys stakes in African reserves
Etisalat takes swift action over sluggish broadband
MoU to set up DMCC cotton trade corridor
Last Update at 10:09 pm on March 16, 2008
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