United Arab Emirates

UNITED ARAB EMIRATES
Name
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Institution
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United Arab Emirates
1) Name and symbol of the country's currency, profile of the currency
The currency symbol for United Arab Emirates is called the dirham, whose currency abbreviation is AED. There are other unofficial abbreviations like DH or Dhs. The United Arab Emirates dirham was introduced on 19 May, 1973, when it replaced the Qatari and Dubai riyal and the Bahraini dinar (abbreviated as BHB) at 1 AED =0.1 BHD. The BHD has been used in Abu Dhabi between 1966 and 1973, while the six other emirs namely: Dubai, Sharjah, Ajman, Umm al-Quwain, Ras, al-Khaimah and Fujairah used the Qatar and dubai riyal in those years. Between 1959 and 1966, all the seven emirs used the currency of Gulf rupee. Qatar and Dubai had adopted the Saudi riyal (SAR), albeit briefly, which was at a rate of Indian rupee exchanging at 1 SAR= 1.065 INR in 1966. Today the exchange rate of the Saudi riyal and the Indian rupee stands at 1 SAR =14.64 INR. The Bahrain dinar was introduced in UAE in 1965, where it replaced the Gulf rupee, at a rate of 1 BHD =10 Gulf rupees. The Gulf rupee at that time was at par with the Indian rupee on until 1966. Today, the exchange rate of the Bahraini dinar and the Indian rupee stands at 1 BHD –145.600 INR (Toledo, 2013).
The Gulf rupee which is also known as the Persian Gulf rupee was introduced in the Persian Gulf countries as well as the Arabian Peninsula and was equivalent to the Indian Rupee until 1966. Today the exchange rate of the United Arab Emirates and the Indian rupee stands at 1 AED =14.7 INR. The United Arab Emirates dinar has been at an exchange rate of 1 USD =3.6 AED since 1997 in November. The United Arab Emirates dirham is divided into 100 fils. The in circulation coins as of current are in dominations of 25, 50 fils and 1 dirham. The banknotes currently in circulation are in denominations of 5, 10, 20, 50, 100, 200, 500, 1000 dirhams (Central Bank of the UAE).
The Dirham has been an important currency among Islamic world because of the fact that it has been a prime medium of exchange for ages. Dirham is derived from the word ‘dirhem’ which comes from "drachm" which is the name of an ancient Greek coin. At one time in the country’s history, the UAE was considered a poor desert country without any scope for agriculture, but that tide has since been turned with the country now ranking 35 out of 232 countries due to its vast oil wealth (Sayani, and Miniaoni, 2013). UAE now has a real high standard of living with its wealth exports contributing over one third of the country’s Gross Domestic Product (GDP). The UAE dirham has been constant against the United States dollar, with an exchange rate of 1 USD = 3.67 UAE, a rate that has not fluctuated majorly in a long span of time. Lately however, this linkage between these two currencies has proved not to be much advantageous due to the rece...