DIFC Report outlines proposed institutional structure for Gulf Central Bank
The Dubai International Financial Centre (DIFC) Authority has released a report outlining options for the institutional structure and governance of a proposed Gulf Central Bank (GCB), a central requirement to meeting the January 2010 deadline for implementation of a GCC common currency. Entitled "The Institutional Framework of the Gulf Central Bank," the report says the GCB could be formed and in operation by 2009 to prepare the way for the currency's introduction and to test and fine-tune the bank's decision-making mechanisms.
Nasser Al Shaali, CEO, DIFC Authority, said, "The DIFC is an active participant in policy discussions regarding local and regional economic and financial issues. This analysis moves forward the debate regarding a GCB and currency union and reflects the DIFC's mission to promote both regional economic development and Middle East integration into the global economy."
While the report, does not reflect the opinions of the DIFC Authority or any government or governmental authority, it outlines a number of possible central bank structures and monetary policy voting formulas, as well as other elements vital to setting up a well-governed central bank. It recommends creating a new GCB with its own staff and administration, noting that this would be the most effective, as well as the most welcomed and "credible" in the eyes of regional and global markets.
