Single Regional Currencies – Gulf Cooperation Council and Latin America

• Gulf Cooperation Council leaders have come to a formal agreement on the creation of a single currency for their 6 nations economic block by 2010. Peter J. Cooper reports in, New GCC single currency agreed, will it include gold? :
   
  GCC assistant secretary-general Mohammad Al Mazroui told Gulf News: ‘We first have to decide on the location of the Central Bank, then the Central Bank and Monetary Council will have to decide on the gold reserves for the Central Bank’.The creation of the GCC single currency – likely to be known as the Khaleeji which means Gulf in Arabic ….  
   
• This is seen by Gold Bugs as positive for Gold and negative for USD. Once this Khaleeji comes into existence, many Gulf Arab nations will no longer peg their currency to the USD. It will not be surprising to find oil traded in this currency instead of USD. This will clearly be a threat to USD hegemony.
   
• Over in Latin America, the impetus for a single regional currency is moving along rapidly. USD is increasingly seen as an economic risk worldwide. In 7 countries talk single currency, Venezuela calls for IDB exodus :
    
  Seven countries, including two Caribbean islands, signed a document today paving the way for the establishment of a single currency among them, Cuban state media reported today.
   
  The political leaders of Venezuela, Bolivia, Honduras, Nicaragua, Ecuador, Cuba and Dominica issued a final Declaration on Wednesday that gives a green light to the creation of a single currency, called the Sucre, …..
   
  The Declaration also expresses the desire on the part of ALBA members and Ecuador to get out of “the monopoly of the [US] dollar” as the currency for international trade.
     
• Hugo Chavez in Venezuela Proposes New Regional Currency During ALBA Summit :
   
  Caracas, November 28th, 2008 (Venezuelanalysis.com) — In a speech at the III Extraordinary Summit of the Bolivarian Alternative for the Americas (ALBA) in Caracas on Wednesday, Venezuelan President Hugo Chávez proposed the creation of a regional monetary bloc with its own currency to break the hegemony of the U.S. dollar and U.S.-dominated international financial institutions.

  “We are going to create a proposal for a monetary zone of solidarity-based commercial exchange,” said Chávez. “The hegemony of the dollar must end.”

• Venezuelan ambassador Samuel Moncada :
   
  …told 500 people at the Latin America 2008 event in TUC Congress House that, faced with the crisis sweeping the US, progressive governments in the region offered an alternative to “casino capitalism.”
   
  He defiantly insisted that “the poorest must be our priority, not the banks and the financial markets. We cannot allow rich countries to decide for us what is to happen in the face of a new depression.” 
   
• All these moves must be seen in the light of the economic problems in America. Many countries around the world no longer have confidence in the American, Anglo Saxon capitalistic model. They are taking steps to limit the damage done to their own economies should the USD collapse. The message is quite clear : USD hegemony is in the final death phase. See also : Chinese Yuan to be International Currency .

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