Gulf States Insist On A 2010 Target For Unified Currency

Doha, Qatar (AHN) - Despite misgivings by a number of Gulf states to meet a 2010 deadline to have a single regional currency, an official at the ongoing 28th Gulf Cooperation Council meeting insisted the three-year target stays. Earlier, Oman and the United Arab Emirates asked for a five-year extension after officials of the two nations said they were not prepared to sign the single currency agreement.

The Gulf News quoted an unnamed Gulf officials who declared, "There will be no new deadline but an affirmation of the original deadline."

The official added, "We still have two years to go where states can gear up to it. Otherwise the unified currency agreement can be launched by those who are ready. Others can join them later."

The same pace is being experienced by the European Union in getting all members of the 27-member bloc to use a single currency, the euro. Only 13 member-states have adopted the euro, to rise to 15 on January when Cyprus and Malta join the Eurozone. Poland said it will take a few more years before it changes currency.

While waiting for the monetary union on 2010, the UAE, Saudi Arabia, Kuwait and three more small Middle Eastern nations agreed to continue pegging their currencies to the dollar.

Kuwait, on May, deserted the peg when the dollar's decline led to higher inflation rates at home. As the 2010 deadline approaches and more Gulf states express hesitation to immediately change to a single monetary unit for the region, experts believe more Middle East nations will revalue their currencies or switch pegs.

UAE is holding on to the dollar as its peg since its inflation is driven by domestic factors like escalating rents, said Sultan Nasser Al Suweidi, UAE's Central Bank Governor.