GCC to endorse monetary union deal at November summit

Dubai: The six Gulf Cooperation Council (GCC) countries will endorse at their November summit in Muscat the proposed monetary union agreement and announce the setting up of a monetary council in a prelude to creating a GCC central bank.

GCC Secretary-General Abdul Rahman Al Attiyah said the new council will then announce further details such as when a common currency would be launched.

"Next summit in Muscat will endorse the agreement and the setting up of the monetary council," Al Attiyah told Gulf News in an exclusive interview.

Central bank governors and monetary authorities of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE have discussed the issue and referred it to the meeting of the GCC finance ministers in Jeddah on September 17.

"As for the timetable [to launch the monetary union], it will be drawn once the monetary council is announced and its organisational structure and bylaws are finalised," Al Attiyah said.

Setting up of the monetary council is one step before establishing a GCC central bank. Once it is approved in Muscat, it will be a big step towards achieving the GCC monetary union, which the member countries aim to achieve in 2010.

Some experts have doubted whether that deadline can be achieved because the member countries are yet to agree on several details, including the central bank's location, the proposed currency's name and whether the unit should be pegged to the US dollar or a basket of major currencies.

UAE Central Bank governor Sultan Bin Nasser Al Suwaidi said recently the monetary union could be launched on time but in stages.

As for the implementation of the Gulf Customs Union, for which the countries have set 2009 as the target date, Al Attiyah said the remaining two issues that need to be settled are the customs protection and joint collection. These are expected to be resolved by 2008-end.  (gulfnews, 9.08.2008, Jumana Al Tamimi, Associate Editor)