October 17, 2009IMF Highlights Gulf States Role
MUSCAT -- Gulf states will play an important role as the world starts to recover from the global financial crisis and have handled the regional downturn strongly, the head of the International Monetary Fund said Saturday.
"The GCC hasn't been immune (from global downturn), but they faced the storm in a position of strength and have been ahead of the pack" by providing support and liquidity to banks, Dominique Strauss-Kahn, managing director of the financial body told reporters on the sidelines of a finance meeting.
Mr. Strauss-Kahn said that as the world starts to recover from the downturn, the oil-rich Gulf region would play an important role globally.
"The role of the GCC is very important for recovery. They are countries with a lot of control on the oil production of the world," he said, adding that as the world begins its recovery, oil prices are also likely to rise.
"As the recovery goes on, there's an increase in the risk of oil prices," he said. "The way the GCC will manage this question has a lot to do with the risk of or the real recovery of the global economy."
Mr. Strauss-Kahn declined to comment on whether the IMF and Gulf officials had discussed their contributions to the fund, but indicated that the fund has enough cash.
When asked whether U.S. dollar is a stable currency for the Gulf region, Mr. Strauss-Kahn said: "Of course it has advantages, as always for a peg, and it may also have some drawbacks."
