The governors of the six central banks in the Arabian Gulf Cooperation Council have been given their political marching orders to unify our currencies by 2010, that is in less than 3 years’ time, but it seems that political orders are one thing, practical considerations are a wholly different kettle of fish. For one thing, none of the Gulf countries follows the same set of rules and regulations, nor levels of transparency in reporting their economic indicators or ways and means to control inflation and the myriad of other necessary things that need to be done in order to achieve the monetary union utopia.
That’s why, the recent meeting of the central bankers was cut short by a day, and even the “touristic tour” of the holy city of Medina in the western part of Saudi Arabia and the second most sacred city in Islam, has even been rushed to bundle the bankers back into their planes to get them back in their posh offices, homes, or anywhere but Medina.
So, ladies and gentlemen, we have a problem. One that is evidenced first by Oman pulling out of the union and not to put to fine a point on it, calling the monetary union schedule and practicality ludicrous. This was further amplified by our own beloved crown prince by remarks which have been quickly “spinnified” by politicos to show that he really didn’t mean it that way… how they feel now when he has – once again – been proven correct is no mean feat of contemplation.
My read of the situation; therefore, is that it would be a miracle if the Arabian Gulf countries achieve monetary union by 2010, or 2020 for that matter. In the absence of transparency or at least a unified set of benchmarks it is just impossible. What would we really benefit from a union that would further devalue our currency directly due to differences in application of transparency and public policies between the countries concerned? Other than increasing the level of poverty in our communities and the further shrinking of an already depleted middle class, nothing.
I for one am not looking forward to it. Much more thought need to be put into it. What they need to do before they even think of unifying our currencies, is at least put in a set of metrics which are rigorously applied and transparently monitored in order to enact such far reaching policies, and of course they need to put the Arabian Gulf citizen at the forefront of their thoughts.