GCC Common Currency Plan 2010
Reports have surfaced that the GCC will implement a common currency in 2010 for all GCC members. The European Central bank is already consulting on the planned currency union and has already published reports therein.
Economic Benefits with a GCC common currency:
- Limited Foreign Exchange risk, attracting foreign investors
- Controls on inflation
- Increased competitiveness resulting from integration
- New economic and investment opportunities from abroad, increased trade
- Facilitate trade among existing trading partners (e.g. EU, US)
Given the strength of the Middle East market, it is important to keep in mind potential regional economic threats.
- Threats of political instability
- Global recessions
- Those markets more insulated from the global economy would likely be less impacted. For example, if a global recession were to impact the Middle East, Dubai’s tourist sector would like be more hard hit, impacting the local economy, compared to Abu Dhabi which relies on energy prices.
Disclaimer: SIS International Market Research makes to representation to the accuracy or representation of this information, and is not liable for decisions inspired from this information. This data does not necessarily reflect SIS’ perspective on the region. Copyright (C) 2008. All Rights Reserved.