So the fuss is back again about the currency plan, Bahrain, Kuwait, Qatar and Saudi are going to proceed with it even after UAE withdrawl, and local reporters are saying that the UAE’s withdrawal was a result of Saudi refusal of financial support to the UAE’s tanking economy and not the reasons they stated before.

Personally I think the UAE don’t really need Saudi support. So apparently the cause of UAE’s withdrawal from the plan is probably the one they stated; they want the central bank in the UAE.

It is understandable given the huge amount of political power the KSA wields between the GCC countries that the Emarati’s want the bank to be in their country. Locating the bank in Saudi will surrender more power to the Saudi and the kingdom will have hegemony over the GCC political and economics affairs.

However, keeping in mind the rumors if they turn out to be true, if the bank is located in the UAE and their economy tanks that will be a serious blow to the new currency and monetary union.

Perhaps it would have been more prudent to locate the bank in Bahrain given the economical development the country have had and is fostering. That should’ve eased the fears of UAE and avoided the rumors of their tanking economy at the same time. But then I’m Bahraini so I might be biased a little.