UAE quits Gulf monetary union

May 22nd, 2009 - 12:36 pm ICT by ANI  

Nicosia, May 22 (ANI): The United Arab Emirates announced on Wednesday that it decided to withdraw from a planned Gulf Arab Monetary union, something with has been debated for the last 30 years. The decision does not affect UAE’s broader membership in the Gulf Cooperation Council (GCC).

The decision casts doubts over the future of the project, although the other four countries- Saudi Arabia, Kuwait, Qatar and Bahrain- reiterated their intention to participate. Two years ago, GCC member Oman announced that it would not join the planned single currency.

According to WAM news agency, UAE’s announcement was made by a Foreign Minister official who said that the general secretariat of Gulf Cooperation Council was informed accordingly.

Journalists and banking officials believe that the decision to withdraw from the planned monetary union was the result of the recent announcement that the proposed central bank of the GCC would be located in Saudi Arabia. The UAE government expected that the bank would be based on its own territory.

On May 5 GCC Secretary General Abdurrahman al-Attiyah told journalists that the first step toward creating a Gulf central bank would be the establishment of a Riyadh-based monetary council, which would exist in a ” transitional phase” in the move towards monetary union.

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