Wednesday, December 05, 2007

GCC states confirm 2010 target date to launch single currency - News, analysis, reports

Business Intelligence Middle East - bi-me.com - GCC states confirm 2010 target date to launch single currency - News, analysis, reports: "GCC states confirm 2010 target date to launch single currency Author: Moussa Ahmad Source: BI-ME and media reports Published: 04 December 2007 RSS Feeds | QATAR. The communique issued at the end of the summit said the six-nation Gulf Cooperation Council (GCC) remained committed to a 2010 target date for monetary union, although analysts regard this as very difficult to achieve. '

"The leaders have decided to continue to work towards achieving the monetary union... and confirmed keeping the date of 2010," Abdulrahman al-Attiyah told reporters.

"They have tasked the finance ministers and governors of central banks to continue working to reach convergence, and to present the results to the next summit which will be held in Oman," he added.

Analysts believe the decision was taken during the preparatory ministerial meetings of Finance Ministers Sunday, ahead of the summit at the insistence of Saudi Arabia.

Oman has pulled out of the single currency project, saying that it will not be ready to join. The UAE has openly said that the 2010 launch is not possible because of technical, legislative and fiscal hurdles.

Kuwait in May dropped the dollar peg in favour of a basket of currencies to ward off imported inflation.

"Although it is possible to have a two speed monetary union, with at least two or three core members joining first, followed by the others at a later stage, it is difficult to see now (post Qatar summit) who the first adopters would be. By definition to achieve monetary union you need at least two members" said an analyst in Dubai

All the GCC countries apart from Kuwait continue to peg their currencies to the dollar.

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