Mideast banks revolt against US dollar

Middle East Times


UPI

March 15, 2006

WASHINGTON -- A number of Middle Eastern central banks said on Tuesday that they would seek to switch reserves from the US greenback to euros.

The United Arab Emirates (UAE) said that it was considering moving one-tenth of its dollar reserves to the euro, while the governor of the Saudi Arabian central bank condemned the decision by the United States to force Dubai Ports World to transfer its ownership to a "US entity", the UK Independent reported.

"Is it protectionism or discrimination? Is it okay for US companies to buy everywhere but it is not okay for other companies to buy the US?" said Hamad Saud Al Sayyari, the governor of the Saudi Arabian monetary authority.

The head of the UAE central bank, Sultan Nasser Al Suweidi, said that the bank was considering converting 10 percent of its reserves from dollars to euros.

"They are contravening their own principles," said Suweidi. "Investors are going to take this into consideration [and] will look at investment opportunities through new binoculars."

The Commercial Bank of Syria has already switched the state's foreign currency transactions from dollars to euros, Duraid Durgham head of the state-owned bank said. The decision by the bank of Syria follows the announcement by the White House calling on all US financial institutions to end correspondent accounts with Syria due to money-laundering concerns.

Syria's finance minister Mohammed Al Hussein said: "Syria affirms that this decision and its timing are fundamentally political."