5 Dirhams – Qatar

In 1973, Qatar's currency situation was fundamentally shaped by its recent independence and the region's economic integration efforts. Following its separation from the British protectorate in 1971, Qatar initially used the Gulf rupee and then the Saudi riyal as transitional currencies. However, the key development was its participation in the newly formed Gulf Currency Agreement with Bahrain, Abu Dhabi, and Dubai. This pact led to the introduction of the Qatar-Dubai riyal in 1966, a shared currency pegged to the British pound sterling, which was still in circulation as the primary legal tender in early 1973.

This arrangement, however, faced a significant external shock in 1973: the collapse of the Bretton Woods system and the subsequent floating of major world currencies, including the British pound. The peg to the volatile pound became increasingly problematic for Qatar's growing economy, which was simultaneously experiencing a dramatic surge in oil revenue following the 1973 oil crisis. The need for monetary stability and greater independent control over its burgeoning wealth prompted Qatar to reconsider its currency union.

Consequently, 1973 became the final year of the Qatar-Dubai riyal. Recognizing the limitations of a shared currency and the unsuitability of the pound sterling peg, Qatar took decisive sovereign action. On May 19, 1973, the State issued the Qatari riyal (QAR) as its exclusive national currency, replacing the Qatar-Dubai riyal at par. Crucially, the new riyal was pegged not to the pound, but to the Special Drawing Rights (SDR) of the International Monetary Fund, a more stable basket of currencies, marking the beginning of Qatar's modern and independent monetary policy.