The technical committee created to initiate steps for the proposed monetary council will meet in the next few days in Kuwait in this regard.
“We are making all-out efforts to achieve the target on time with the support of the governments of GCC countries. But we will not tell you in advance whether we will form the GCC Monetary Union as per the initial plan by 2010 until we complete the whole process,’’ Mohammed Al Mazroui, Assistant Secretary-General at the Gulf Cooperation Council Secretariat, told Khaleej Times.
The technical committee will be holding four or five meetings this year in Kuwait to fine-tune the action plan. Kuwait has succeeded Qatar recently as the head of the technical committee.
Al Mazroui said that the GCC countries were yet to decide where to headquarter the proposed central bank of the monetary union. “The ministers of finance and economy of the GCC countries had a round of discussion on this issue in Riyad last month, but a decision has been deferred to the next round of discussions.’’
He said that the process of ratifying the decision to constitute a monetary union, taken during the last GCC meeting in Oman, has begun in a couple of GCC countries. “But this might take some time as each country has to go through their respective legislative bodies to get the approval.’’
After the ratification, each country has to propose a nominee to the Gulf monetary council. None of the six GCC countries have completed this process, Al Mazroui said.
Asked whether the unified GCC currency will continue to be linked to the US dollar, he said: “There will not be much changes in the existing currency regimes in different GCC countries.’’
The global financial crisis has made the concept of GCC monetary union more relevant as it has opened up new opportunities for the GCC member countries to play a more active role in the international economic arena, Al Mazroui said. “They (the GCC countries) can become an important economic power because of their combined size and resources. The GCC countries account for about 45 per cent of the global oil reserves and 20 per cent of the natural gas reserves. When they have a common currency and market, they will be able to strengthen their sphere of influence in the global financial markets. They will also have a stronger say in the affairs of the international funding institutions like the World Bank and the International Monetary Fund.”
