Unified/single currency for GCC: Success and Limitation Factors and a Comparison

This research proposal aims to explore the research issue of the importance for a unified or single currency for the GCC countries by evaluating the benefits and disadvantages of single currency and their difference with the current practices, that is, usage of different currencies for respective countries. The research study will particularly focus on the impact of single currency in the operation management of the supply chain industries in this region.

Running head: RESEARCH PROPOSAL
Unified / single currency for GCC: success and limitation factors and a comparison
of unified/single currency and different currencies for different countries
Name of the Student:
Name of the University:
Author note:

1RESEARCH PROPOSAL
Table of Contents
Introduction......................................................................................................................................2
Research aim and objectives........................................................................................................3
Research questions.......................................................................................................................3
Literature review..............................................................................................................................4
Concept of single currency and its advantages and disadvantages..............................................4
Operational management in supply chain industry.....................................................................5
Supply chain growth in the GCC and Middle East and North Africa (MENA)..........................6
Research methodology.....................................................................................................................6
Research philosophy....................................................................................................................7
Research purpose.........................................................................................................................7
Research approach.......................................................................................................................8
Research design...........................................................................................................................8
Data collection process................................................................................................................8
Data analysis process...................................................................................................................9
Ethical issues...............................................................................................................................9
Timeline.......................................................................................................................................9
References......................................................................................................................................10

2RESEARCH PROPOSAL
Introduction
Gulf Cooperation Council or GCC refers to a regional and intergovernmental economic
and political union of 6 Gulf countries. The member states of GCC are Kuwait, Bahrain, Oman,
Saudi Arabia, Qatar, and the United Arab Emirates (UAE) (Britannica.com 2019). The council
was established in 1981 and all the member states operate as monarchies. The objectives of
forming the council were to form customs union, common or single market and a common
currency for all these member states as in case of the European Union (EU) (Legrenzi 2016). In
the broad perspective, the council was formed to formulate and establish similar regulations in
the fields such as, economy, finance, trade, tourism, customs, religion, administration and
legislation, foster technical and scientific progress in different fields of business, such as,
industry, infrastructure, agriculture, water, mining and animal resources, to establish scientific
research and development centers and projects, set up various joint ventures, to develop
cooperation between the private and public sectors of the countries, strengthen the cultural ties
among the people and to establish unified military for all the countries (Al Hassan 2014). There
has been a proposal to establish a single currency for the member states of GCC in 2009, and 4
states, namely, Qatar, Kuwait, Bahrain and Saudi Arabia agreed for the proposal. However, due
to reasons like political differences and financial crisis, the other two members, that is, Oman
and the UAE withdrew their support and hence, a unified currency was not established (Ganguli
2016). This research proposal aims to explore the research issue of the importance for a unified
or single currency for the GCC countries by evaluating the benefits and disadvantages of single
currency and their difference with the current practices, that is, usage of different currencies for
respective countries. The research study will particularly focus on the impact of single currency

3RESEARCH PROPOSAL
in the operation management of the supply chain industries in this region. The paper will
commence with the introduction to the research topic, followed by research aim and objectives,
research questions, review of previous literatures and a research methodology that will be
followed for conducting the study.
Research aim and objectives
The aim of the research study is to evaluate the effectiveness of a unified or single
currency for the GCC countries by exploring the pros and cons of single currency and its
difference with the existing currency system of the countries, that is, usage of different
currencies.
The objectives of the study are:
 To evaluate the existing currency system of the GCC countries and its effectiveness in the
supply chain industries
 To explore the advantages and disadvantages of a unified currency for the GCC
 To compare the potential impact of the single currency on the operational management of
the supply chain industries with the existing practices
 To provide recommendations to the supply chain industry of GCC based on the findings
Research questions
1) What is the impact of exchange rate and different currencies on the operations of supply
chain industry of the GCC region?
2) What are the benefits and costs of single currency unit?
3) What would be the difference in the operational management of the supply chain industry
of the GCC if single currency unit is established?

4RESEARCH PROPOSAL
Literature review
Concept of single currency and its advantages and disadvantages
Single currency is formed when a number of countries come together to join their
individual currencies into a single one. The biggest example of single currency is the Euro,
which is the unified currency for the member countries of the European Union. The currency was
introduced in 1999 and came into full effect since 2001 (Hobolt and Wratil 2015). The
arguments for introducing the single currency were that, a single currency can eliminate the cost
of currency conversion, that is, associated with different exchange rates, and it increases the
price transparency and thus makes all types of trade easier for the businesses as well as for
individuals. It helps in increasing competition as well as efficiency of the businesses with
transparent prices, the inward investment is increased, and moreover, the uncertainties regarding
the exchange rates are eliminated with single currency (Mursa 2014).
On the contrary, single currency also has some disadvantages. As highlighted by
Georgieva Svrtinov, Gorgieva-Trajkovska and Temjanovski (2014), single currency has the
policy of one size fits all, which is not necessarily beneficial for all the countries, as the
economic conditions are not similar for all countries. One economy may be experiencing a
downturn, while others are booming, and in such cases, single currency is not beneficial for that
country facing economic challenges. Similarly, the impacts of policies are also different on
different nations due to different economic conditions (Almunia 2016). The changes in oil prices
have different impacts on the oil producing countries than the countries that do not produce oil.
Lastly, moving into new currency involves short term transition cost as new money needs to be
printed and the old currency should be taken out from the economy and this will have an impact
on the money reserve of the economy (Gibson, Palivos and Tavlas 2014).

5RESEARCH PROPOSAL
While the Euro was established for the EU, the member countries all weighed the pros
and cons of the new system and finally the benefits of the new system outweighed the cons and
thus, the single currency system was established. Along with Euro, the EU also introduced the
system of custom union and single market for the member countries, which benefitted the
international trade and domestic growth for all the member countries of the EU. Thus, single
currency helps in improved economic as well as political integration (Togan 2015).
However, Baimbridge and Whyman (2015) criticized that one of the objectives of the
single currency in the EU was to unleash the economic potential of the EU countries to establish
investment and economic growth, to achieve stable and low inflation, encourage greater
international trade, ensure price stability by reducing the transaction costs and raising the price
transparency, but it was seen that entering into Eurozone involved many disadvantages for the
countries. The loss of the monetary and the exchange rate policies often weakened the national
economic management, especially for those countries that were already facing poor economic
growth, high inflation and unemployment level. Thus, it can be termed as a flawed currency area.
Operational management in supply chain industry
Supply chain refers to the sequence of the procedures or methods that are involved in the
production and distribution of products and this network is built with individuals, resources,
organizations, technology and activities that are associated with the manufacturing, distribution
and sale of a product. From sourcing the raw materials from the suppliers to the manufacturers to
the delivery of the end product to the customers, the operations of supply chain industries are
quite wide (Fredendall and Hill 2016). Thus, it is stated by Hugos (2018), currency and exchange
rate plays a major role in the business performance of supply chain companies; especially, those
operate in the international market. The exchange rates affect the price of the supplies as well as

6RESEARCH PROPOSAL
technologies and other resources, which is reflected in the end price of the products. The
certainty of supplies is also affected during any financial crisis.
Supply chain growth in the GCC and Middle East and North Africa (MENA)
As seen from the reports in Logistics Middle East (2019), the supply chain industries
have been growing in the Middle East and the Gulf countries. The approval of the Dubai Silk
Road Strategy coupled with the excellent logistic infrastructure, UAE has turned into a source
market for the supply chain industries, especially for manufacturing and exporting the
pharmaceuticals for the high demand markets like Asia and Africa. In 2019, the pharmaceutical
sector in the MENA gained a budget of USD 1.2 billion for its exceptional growth in the past
few years. Other than these, the other growth sectors are the oil and gas and port operations
(Logistics Middle East 2019). All these industries operate in the international market and hence,
the impact of price volatility in the international market and exchange rate is quite significant on
the supply chain operations in the GCC countries.
Research methodology
Research methodology refers to the strategies and actions to be undertaken to identify,
collect and analyze the information to conduct the research study. in other words, research
methodology consists of the processes that are used to identify and select the appropriate data for
addressing the research questions in the most logical manner and analyze the data to get the
findings for the study (Kumar 2019). It comprises of research philosophy, research purpose,
approach, design, data collection and analysis process and a proposed timeline to complete the
study.

7RESEARCH PROPOSAL
Research philosophy
Research philosophy refers to the set of beliefs or assumptions about the nature and
source of the data required for the study and the steps to be taken to collect and analyze the data
(Hughes and Sharrock 2016). Various types of most commonly used research philosophies are
positivism, interpretivism, pragmatism, and realism. In the given study, the researcher will apply
the interpretivism research philosophy, as it allows the researcher to assess the research issue
qualitatively. As stated by Scheurich (2014), this philosophy enables the researcher to apply
observation and interpretation skills to evaluate the social interest in the study by exploring the
qualitative data. As the research study aims to evaluate the potential social impact of the single
currency on the operation management in the perspectives of the supply chain industry of GCC
region, the qualitative aspect should be evaluated and hence, interpretivism is suitable for this
study.
Research purpose
Explanatory and exploratory are two research purposes that are used in the studies. As
stated by Lewis (2015), explanatory research is useful for explaining a research phenomenon on
the basis of existing theories and it is mostly used for explaining the cause and effect relationship
between the research variables. On the other hand, exploratory research is useful for seeking new
insights about the research topic and assessing the issue in a new direction (Bell, Bryman and
Harley 2018). In the given study, the researcher will follow the exploratory research purpose as
the study requires the aspects of single currency to be explored and potential impact to be
assessed. As it is not an established practice, the real data about the benefits or disadvantages of
single currency in GCC does not exist and hence, a new perspective must be derived from the
study.

8RESEARCH PROPOSAL
Research approach
Two types of most widely used research approaches are inductive and deductive
approach. Under inductive approach, the researcher presents new theory or new perspective from
the general data and provides insight for specific phenomenon (Ormston et al. 2014), while under
deductive approach, the specific data is evaluated or tested against established theories to get
generalized findings (Sik 2015). Hence, in this study, the researcher will follow the inductive
approach as new insights need to be generated from the supply chain industry data about the
implementation of single currency in GCC.
Research design
As highlighted by Creswell and Poth (2017), research design is defined as the
arrangement of the conditions for collection of data for the research study. Descriptive,
correlational, experimental, quasi experimental are some of the research approaches and in this
study, the researcher will adopt the descriptive research design. The data will be analyzed in a
comparative study and the findings will also be presented descriptive manner.
Data collection process
The researcher will collect secondary data for this study. Various information on different
aspects of the single currency; and the data on the operations of supply chain industries of the
GCC region will be collected from several authentic sources, such as, government websites,
publications, and annual reports of the companies, newspaper articles, and journal articles. As it
is not possible to collect primary data on this topic, the researcher must rely on the secondary
data.

9RESEARCH PROPOSAL
Data analysis process
Qualitative data analysis process will be followed for this study. Secondary qualitative
and quantitative data will be collected and qualitative descriptive analysis process will be
adopted for analyzing the information and get new insights about the research topic. A
comparative study will be done to get the findings.
Ethical issues
Some ethical issues need to be addressed in this research. Firstly, originality of the paper
should be strictly maintained. All the information should be properly cited with correct
references as plagiarism is a serious offense and it has severe consequences. Secondly, as per the
Data Protection Act (1998), all the data should be confidential and should be used only for
academic purpose. Those should be stored in the university database. Thirdly, the confidential
data should be collected from authentic sources by accessing proper channels.
Timeline
Month
Task 1 2 3 4 5 6 7 8 9 10 11 12
Making a strategy
Making a framework
Literature review
Secondary data
collection
Data analysis
Presenting the findings
and discussion
Providing the conclusion
Thesis submission
(Source: Author)

10RESEARCH PROPOSAL
References
Al Hassan, O., 2014. The GCC’s Formation: The Official Version. Gulf Cooperation Council’s
Challenges and Prospects, pp.9-21.
Almunia, J., 2016. Seven years with the Euro. In The€ uro and the Dollar in a Globalized
Economy (pp. 31-36). Routledge.
Baimbridge, M. and Whyman, P.B., 2015. The eurozone as a flawed currency area. In Crisis in
the Eurozone (pp. 1-20). Palgrave Macmillan, London.
Bell, E., Bryman, A. and Harley, B., 2018. Business research methods. Oxford university press.
Britannica.com, 2019. Gulf Cooperation Council | History & Countries. [online] Encyclopedia
Britannica. Available at: https://www.britannica.com/topic/Gulf-Cooperation-Council [Accessed
15 Mar. 2019].
Creswell, J.W. and Poth, C.N., 2017. Qualitative inquiry and research design: Choosing among
five approaches. Sage publications.
Fredendall, L.D. and Hill, E., 2016. Basics of supply chain management. CRC Press.
Ganguli, S., 2016. An economic analysis of sustainability of a potential GCC economic and
monetary union during 2005-2014. World Journal of Entrepreneurship, Management and
Sustainable Development, 12(3), pp.194-206.
Georgieva Svrtinov, V., Gorgieva-Trajkovska, O. and Temjanovski, R., 2014. Cost and benefits
of adopting Euro. Applied Sciences and Business Economics Journal, 1(3), pp.57-64.

11RESEARCH PROPOSAL
Gibson, H.D., Palivos, T. and Tavlas, G.S., 2014. The crisis in the Euro area: an analytic
overview. Journal of Macroeconomics, 39, pp.233-239.
Hobolt, S.B. and Wratil, C., 2015. Public opinion and the crisis: the dynamics of support for the
euro. Journal of European Public Policy, 22(2), pp.238-256.
Hughes, J.A. and Sharrock, W.W., 2016. The philosophy of social research. Routledge.
Hugos, M.H., 2018. Essentials of supply chain management. John Wiley & Sons.
Kumar, R., 2019. Research methodology: A step-by-step guide for beginners. Sage Publications
Limited.
Legrenzi, M., 2016. Did the GCC make a difference? Institutional realities and (un) intended
consequences. In Beyond Regionalism? (pp. 119-136). Routledge.
Lewis, S., 2015. Qualitative inquiry and research design: Choosing among five
approaches. Health promotion practice, 16(4), pp.473-475.
Logistics Middle East, 2019. UAE leads pharmaceutical sector growth with US $1bn investment.
[online] Logistics Middle East. Available at: https://www.logisticsmiddleeast.com/supply-
chain/32291-uae-leads-pharmaceutical-sector-growth-with-us-1bn-investment [Accessed 15
Mar. 2019].
Mursa, G., 2014. Euro-Advantages and disadvantages. CES Working Papers, 6(3), p.60.
Ormston, R., Spencer, L., Barnard, M. and Snape, D., 2014. The foundations of qualitative
research. Qualitative research practice: A guide for social science students and researchers, 2,
pp.52-55.

12RESEARCH PROPOSAL
Scheurich, J., 2014. Research method in the postmodern. Routledge.
Sik, K., 2015. Tradition or modernism in grammar teaching: deductive vs. inductive
approaches. Procedia-Social and Behavioral Sciences, 197, pp.2141-2144.
Togan, S., 2015. The EU-Turkey customs union: a model for future Euro-Med integration.
In Economic and social development of the Southern and Eastern Mediterranean countries (pp.
37-48). Springer, Cham.