Long faces

Discontent rules at the Gulf Monetary Union Meeting

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.

Comments

  1. howard_coward

    It’s not “spinified.” It’s “spun.” Parsed as “spin”, “span”, “spun”. The noun is “spinnification.”

  2. Post
    Author
  3. Pingback: Global Voices Online » Blog Archive » Bahrain: GCC oversight

  4. MoClippa

    This sounds like an outright failure waiting to happen. While a monetary union would surely do much to facilitate/simplify inter-state cash transfers the creation of a regulatory commission that sets standards to joining this union needs to happen first.

    As much as these countries like to pretend they are the A-Team and go gung-ho into things because “it sounded like a good idea, and we’ll weed out all the problems as we go along,” I think the economic implications would likely be highly disastrous.

    First establish a regulatory commission with a decent sized public civil service. Let them research what needs to be done to insure this monetary union works, i.e. issues of corruption, reporting, accountability, transparency etc.

    Once they do that, they need to figure out the necessary standards, legislate them into the body, and force other countries wanting to join the union to legislate those changes into the law and implement them into their institutions and societies. The EU set a great example of how to get one of these unions working by first establishing large legislative standards (most of which went far beyond simple economics) that had to be adhered to before a country could join their Union.

    A touch&Go economic Union is going to be a headache for everyone and will yield a massively corrupt and unbalanced playing field that can only increase any ill feelings countries may have to one another.

    And it can’t stop with one regulatory commison. You need oversight committees, ombudsman, and other large beurocracies to insure that this functions and functions fairly to all those involved.

    Where does it stop after that though, an economic union is fine if we put it into action, but I just hope it doesn’t transalate into eventual demands that Sharia Law precede positive law, or otherwise. What about countries that are frequent human rights offenders (or at least worse then the rest), how are they to be treated… what about state monopolies and subsidies on certain industries…. … god this is a disaster waiting to happen if these guys don’t get their acts together.

  5. Ansgar

    Hallo!
    Euro works fine here. ğŸ˜Ž So I wish you to have some equal. But its much more easier when having a common political idea… I assume thats the lack. :pouty:

Comments are closed.