Gulf dinar 'to replace four local currencies'
Four
Gulf oil producers planning monetary union are expected to name a new
common currency the Gulf dinar, a Saudi academic said yesterday.
And the new currency will run in tandem with national coins and notes now in circulation to ease the transition, he said.
Wadei Ahmed Kably, economics professor at the King Abdul Aziz
University in the Saudi Red Sea Port of Jeddah, said he expected the
Gulf dinar to be issued by the Gulf Central Bank and set at SR10,
nearly $ 2.66.
"Based on the European Union experience, I expect the new currency to
be circulated along with the existing national currencies in the Gulf
Cooperation Council," he told the Saudi Arabic language daily Al Watan.
"Both currencies will remain in circulation by banks and individuals
for one or two years so the public get used to the new currency.
National currencies could then be gradually withdrawn within five years
so the public will not feel any difference," he told the paper.
Saudi Arabia, the world's largest oil exporter, Kuwait, Qatar and
Bahrain are pushing ahead with the monetary union plans following the
withdrawal of the UAE and Oman.
GCC officials have not announced the name of the new currency nor its
value or peg but they have made clear their currencies would remain
pegged to the dollar until a new currency and peg is decided.
Oman pulled out of the scheme in 2007 on the grounds it is not ready
yet while the UAE announced last month it was quitting in an apparent
protest at the GCC leaders' decision to choose Riyadh as the location
of the Gulf Central Bank.
Saudi American Bank (Samba) last week said the UAE pulled out of the
proposed union after insisting on hosting the Central Bank and keeping
national currencies in circulation.
The currencies of Saudi Arabia, Bahrain and Qatar have long been pegged
to the US dollar while Kuwait reverted to a basket of currencies in May
2007 in a bid to tackle soaring inflation, for which it blamed the
weakening dollar.
http://www.gulfinthemedia.com/index....2e48fce7116e05
Four
Gulf oil producers planning monetary union are expected to name a new
common currency the Gulf dinar, a Saudi academic said yesterday.
And the new currency will run in tandem with national coins and notes now in circulation to ease the transition, he said.
Wadei Ahmed Kably, economics professor at the King Abdul Aziz
University in the Saudi Red Sea Port of Jeddah, said he expected the
Gulf dinar to be issued by the Gulf Central Bank and set at SR10,
nearly $ 2.66.
"Based on the European Union experience, I expect the new currency to
be circulated along with the existing national currencies in the Gulf
Cooperation Council," he told the Saudi Arabic language daily Al Watan.
"Both currencies will remain in circulation by banks and individuals
for one or two years so the public get used to the new currency.
National currencies could then be gradually withdrawn within five years
so the public will not feel any difference," he told the paper.
Saudi Arabia, the world's largest oil exporter, Kuwait, Qatar and
Bahrain are pushing ahead with the monetary union plans following the
withdrawal of the UAE and Oman.
GCC officials have not announced the name of the new currency nor its
value or peg but they have made clear their currencies would remain
pegged to the dollar until a new currency and peg is decided.
Oman pulled out of the scheme in 2007 on the grounds it is not ready
yet while the UAE announced last month it was quitting in an apparent
protest at the GCC leaders' decision to choose Riyadh as the location
of the Gulf Central Bank.
Saudi American Bank (Samba) last week said the UAE pulled out of the
proposed union after insisting on hosting the Central Bank and keeping
national currencies in circulation.
The currencies of Saudi Arabia, Bahrain and Qatar have long been pegged
to the US dollar while Kuwait reverted to a basket of currencies in May
2007 in a bid to tackle soaring inflation, for which it blamed the
weakening dollar.
http://www.gulfinthemedia.com/index....2e48fce7116e05