Four Gulf states sign deal on monetary union

[LahoreEstate]

RIYADH (June 08 2009): Four members of the oil-rich Gulf Cooperation Council signed an accord in the Saudi capital on Sunday to create a monetary union, a GCC spokesman said. Foreign ministers from four of the six GCC countries - Bahrain, Kuwait, Qatar and Saudi Arabia - agreed to set up a monetary council in Riyadh this year as a precursor to the ultimate goal of establishing a common currency, the spokesman said.

Oman announced in 2007 that it would not join, while the United Arab Emirates, a key regional financial and commercial hub, pulled out last month after the GCC decided to base the future regional central bank in Riyadh. The UAE had expressed reservations over the monetary union after an informal GCC summit in Saudi Arabia on May 5 decided that Riyadh, which is home to the GCC headquarters, would host the future banking authority, while the UAE was the first member to request hosting the central bank.

The monetary union date was originally set for 2010 but analysts consider that unrealistic given the global economic slowdown. Reports suggest that 2013 is the new target.

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