Gulf single currency in doubt as Kuwait dumps dollar
Afp, Kuwait City
Kuwait's decision to stop pegging its dinar to the dollar has only confirmed speculation that oil-rich Gulf states will not be able to meet a 2010 target to launch their single currency, economists said on Monday. "Certainly, the decision casts a serious doubt over the Gulf states' ability to launch their single currency in 2010... I think such a step is difficult now. It's premature," said Saudi National Commercial Bank chief economist Saeed al-Shaikh. "It makes it much more difficult to prepare the necessary groundwork for a single currency... It's a step backward," Shaikh told AFP. The Gulf Cooperation Council, which groups energy-rich Bahrain, Kuwait, Oman, Qatar, United Arab Emirates and Saudi Arabia, has already taken a number of measures in its bid to launch a monetary union and a single currency by 2010. But last year, Oman said it would not be able to meet the target date while some countries have reportedly expressed reservations on a number of criteria, fuelling speculation that the launch date may not be met. In a surprising decision on Sunday, Kuwait pegged the dinar to a basket of currencies, more than four years of linking it to the dollar in preparation for the single GCC currency.
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