Dollar Trouble

“In the most profound financial change in recent Middle East history, Gulf Arabs are planning – along with China, Russia, Japan and France – to end dollar dealings for oil,” reported the UK Independent last week. According to the story, a number of secret meetings have already been held to hammer out the new monetary framework. The news sent shock-waves around, and understandably so, given the potentially cataclysmic implications of this development. Should it succeed, it would portend nothing less than the collapse of the global monetary regime which has for more than six decades rested on the dollar as its pillar and foundation.

As expected, the countries involved issued prompt denials once the story broke. Their protestations notwithstanding, there is every reason to believe that the story is, in fact, true. For one thing, it was penned by the Independent’s long-time Middle East correspondent Robert Fisk, one of Britain’s most respected and credible journalists. The recipient of more awards and prizes than any other British foreign reporter, Fisk is not known for putting out stories based on unverified hearsay. But even more importantly, the move away from the dollar would be the logical culmination of the stream of warnings and complaints which have been heard in recent months from experts and finance officials of foreign nations.

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