	arab banker says too soon for single currency gulf arab states must coordinate economic policies more closely before moving towards their goal of a unified currency system the president of the arab bankers association said hikmat nashashibi told a news conference at the end of an arab currency traders meeting we have to start with coordination of fiscal policies as a prerequisite for a common system of currencies there is quite a substantial way to go yet he said only then would a unified gulf currency system be a plausible project the six nations of the gulf cooperation council saudi arabia kuwait bahrain oman qatar and the united arab emirates have held a series of meetings this year to examine linking their currencies to a single peg in a system which bankers say could be modelled on the european monetary system ems at present five currencies are linked either officially or in practice to the u s dollar while the kuwaiti dinar is pegged to a trade weighted basket of currencies a common currency system or ems style grid would in theory foster regional trade by providing a basis for stable exchange rates but nashashibi said inter arab trade is at a very low ebb and capital flows between gulf states remain small capital markets in the arab world are still in their infancy he said nashashibi said lack of experience among arab banks a paucity of financial instruments and a legal framework that often does not recognise the western banking concept of interest have hampered the growth of arab markets reuter 
