The creation of a single currency in the Gulf Arab region has become inevitable and is only a matter of time, the executive president of Oman’s central bank was quoted as saying.
Oman is not one of the countries pushing for a common currency, but “serious measures” are being studied to achieve it, the Saudi Arabian-owned Al Sharq al-Awsat newspaper quoted Hamood Sangour al-Zadjali as saying in a statement.
Omani officials were not immediately available on Monday to comment on the report, and it was not clear whether Zadjali’s remarks signalled any new momentum for the region’s single currency project.
The creation of monetary union became a primary objective of the six members of the Gulf Cooperation Council in the early 1980s. Four of them – Qatar, Saudi Arabia, Kuwait and Bahrain – formed a joint monetary council and a forerunner to a Gulf central bank in March 2010.
But the euro crisis and a lack of political will have slowed the project. Oman withdrew from the plan in 2006 and the United Arab Emirates pulled out in 2009.
Many bankers in the region say privately that introduction of a single currency remains unlikely for the foreseeable future, given technical difficulties and the fact that GCC states are struggling with low oil prices, which are having varying impacts on their economies.
Saudi Arabia has slowed sharply and has been forced into painful fiscal reforms, while Qatar and Kuwait, with relatively strong state finances, have come under less pressure.