Global Crisis Could Bring Gulf States Together Over Recovery and Common Currency

Slowdown Expected
Officials meeting this week in Fujairah said:

“The UAE faces a slowdown in loan growth and real estate activity in fallout from the global financial crisis.”

“States in the world's biggest oil-exporting region are expecting the global problems to put the brakes on a regional economic boom supported by six years of high oil prices.”

“But Gulf economies sitting on surplus oil revenues would continue to post growth as they push ahead with a monetary union plan that has gained momentum during the financial turmoil, United Arab Emirates Central Bank Governor Sultan Nasser al-Suweidi said.”

“'The slowdown will be imposed on us … in everything we will see contractions,' he told reporters on the sidelines of a meeting in Fujairah, one of seven emirates in the UAE federation. 'But I think we will still be growing in all directions in a very comfortable way.'”

Currency Cooperation
“The global crisis could bring Gulf Cooperation Council (GCC) members closer together as five of them, including Saudi Arabia, strive to launch a single currency by a 2010 deadline that had been derailed for years, Suweidi said.”

Source: Ola Galal, Global Crisis to Hit UAE loans, Real Estate, Reuters/Hemscott, 10 November 2008.

Dr Geoff Pound

Image: GCC Logo.