The Gulf states support European efforts to stabilise the euro, German Chancellor Angela Merkel said on Tuesday.

'There's interest in having a strong Europe, but it's clear we need to work on our competitiveness. And this is exactly the German position too,' Merkel said in Abu Dhabi after meeting leaders of the UAE on a visit to the Gulf.

Asked whether the European single currency could remain a model for efforts among Gulf nations to create their own joint currency, Merkel said: 'Yes, of course,' adding that the subject had played a prominent part in her talks.

In recent weeks, the euro has been hit by investor concerns about debt in a number of euro zone states.

'It's understood here very well that a region like the European Union, which shares a currency, also needs to try to create a shared basis for economic performance,' she said.-Reuters