KUWAIT CITY - Gulf states should implement a monetary union and single currency in phases, Kuwait's central bank governor said in comments published on Sunday, casting further doubt on a 2010 target date.
"Due to the limited progress achieved so far... I believe that the best way is to work out an administrative plan for the monetary union and single currency and implement it in stages," Sheikh Salem Abdulaziz al-Sabah told Awan newspaper.
The six-nation Gulf Cooperation Council (GCC) plans to launch monetary union and a single currency in 2010, although many experts believe the target date is too ambitious and unrealistic.
Kuwait was one of four GCC members which in June signed an accord to create a joint monetary union council, a prelude to establishing a Gulf central bank and launching monetary union and a single currency.
OPEC kingpin Saudi Arabia, Qatar and Bahrain also signed the pact, while the remaining two members, the United Arab Emirates and Oman, did not.
The UAE was upset at the Saudi capital Riyadh being selected to host the future GCC central bank, while Oman withdrew from the monetary union in 2007 saying it was not ready to meet the preconditions.
Sheikh Salem said the administrative plan should focus on the institutional requirements of the union including financial, trade, statistical and common market policies.
He also said that printing banknotes for the new currency would take three years to complete.
The GCC states have agreed on a number of monetary union requirements but failed to reach consensus on others. They have also failed to fully implement a customs union launched at the beginning of 2003.
Weak dollar may feed inflation in GCC