The United Arab Emirates Dirham, abbreviated as AED, is the official currency of the United Arab Emirates (UAE), a federation of seven emirates in the Middle East.
The UAE Dirham is also represented by the symbol “د.إ”.
In this overview, we will discuss the history, central bank, denominations, and economy related to the UAE Dirham.
History
The UAE Dirham was introduced in 1973, replacing the Qatar and Dubai Riyal and the Bahraini Dinar, which were previously used in the emirates that now form the UAE.
The Dirham’s introduction marked a significant step in the development of a unified monetary system for the newly formed federation.
The UAE Dirham has been pegged to the US Dollar since 1997, with an exchange rate of approximately 3.67 AED per 1 USD.
Central Bank
The Central Bank of the United Arab Emirates (CBUAE) is responsible for issuing and managing the UAE Dirham.
Established in 1980, the CBUAE oversees the monetary policy, regulation of the banking sector, and the stability of the national currency.
The central bank aims to maintain the stability of the UAE Dirham and foster the development of a secure and stable financial system in the country.
Denominations and Subdivisions
The UAE Dirham is subdivided into 100 fils.
Coins are issued in denominations of 1, 5, 10, 25, 50 fils, and 1 Dirham.
Banknotes are available in denominations of 5, 10, 20, 50, 100, 200, 500, and 1,000 Dirhams.
Economy
The UAE has a diverse, high-income economy with significant oil and gas reserves, which have played a crucial role in the country’s development.
However, in recent years, the UAE has been making efforts to diversify its economy, focusing on sectors such as finance, tourism, real estate, and renewable energy.
The pegging of the UAE Dirham to the US Dollar has contributed to the currency’s stability and helped attract foreign investment.
Summary
The United Arab Emirates Dirham (AED) is the official currency of the UAE, managed and issued by the Central Bank of the United Arab Emirates.
Introduced in 1973, the UAE Dirham replaced the currencies that were previously used in the region and has since been pegged to the US Dollar.
The UAE has a high-income economy, with efforts in place to diversify its economic base.