UAE pushes to host planned GCC central bank

The UAE is still pushing to be home to the common central bank planned by the six Gulf Co-operation Council members within their landmark monetary union, the country’s Central Bank governor said yesterday.

Sultan bin Nasser Al Suweidi said the UAE was the first GCC state to offer to host the proposed central bank but added no decision has been reached yet.

“It was not a decision but an offer from us to host the GCC central bank… we were the first member state to make this offer,” Al Suweidi told Emirates Business. “Of course, there should be a GCC central bank as part of the monetary union.

We in the UAE would love to see this bank based here. It will be a very important regional institution and we would like to be its base.”

 

Speaking at an anti-money laundering meeting in Abu Dhabi, Al Suweidi said the UAE possessed “all the financial, economic and logistic capabilities to host the proposed central bank. We hope our brothers in the GCC will take this into consideration and respond to our offer.”

The GCC states plan to create a monetary union by 2010 after having launched a customs union in 2003 and a common market early this year. The European Union-style monetary union is expected to include a common currency, a central bank and other joint institutions.

The UAE is classified as the Middle East’s financial and commercial hub and it has the second largest economy and banking sector in the Arab world after Saudi Arabia. In 2007 it overtook the Kingdom as the top importer.

By the end of 2007, the combined assets of the country’s 49 banks peaked at Dh1.23 trillion from Dh865 billion at the end of 2006, while deposits, also the second largest in the Arab world, surged to Dh720bn from Dh426bn.

The UAE also made record profits of Dh24.4bn, second only to Saudi Arabia. The profits recorded a growth of about 23 per cent over the previous year while Saudi bank earnings declined last year.

 

The assets of the UAE Central Bank also soared to a record Dh184bn at the end of September last year from Dh103bn at the end of 2006.