South African pound

South African pound
Suid-Afrikaanse pond (Afrikaans)
1 Pound note from 1958
Denominations
Subunit
1/20	shilling
1/240	penny
Plural	pond (Afrikaans only)
penny	pence (English only)
Symbol	£
shilling	s
penny	d
Banknotes	10s, £1, £5, £10, and £100
Coins
Freq. used	¼d, ½d, 1d, 3d, 6d, 1s, 2s, 2½s
Rarely used	5s
Demographics
User(s)	Union of South Africa
Issuance
Central bank	South African Reserve Bank
Website	www.reservebank.co.za
This infobox shows the latest status before this currency was rendered obsolete.

The pound (symbol £) was the currency of the Union of South Africa from the creation of the country as a British Dominion in 1910. It was replaced by the rand in 1961, the same year that South Africa became a republic.

In 1825, an imperial order-in-council made sterling coinage legal tender in all the British colonies. At that time, the only British colony in Southern Africa was the Cape of Good Hope Colony. As time went on, the British pound sterling and its associated subsidiary coinage became the currency of every British territory in Southern Africa. The pound at that time was subdivided into 20 shillings, each of 12 pence.

History

The pound sterling became the standard currency of the Cape of Good Hope colony in 1825 following an imperial order-in-council that was issued for the purpose of introducing the sterling coinage into all the British colonies. British coins then replaced the Dutch currency. Before a unified South Africa, many authorities issued coins and banknotes in their own pound, equivalent to sterling.

The Transvaal Republic, the Boer state that in 1902 was to become Transvaal Colony, issued notes from 1867 to 1902 and coins from 1892 to 1902. The gold coins were denominated in pond rather than pounds.

In 1920, the Treasury issued gold certificate notes. The following year, the South African Reserve Bank was established as the sole note issuing authority. Coins were issued from 1923. The South African pound remained equal to the pound sterling throughout its existence, except for a short period following the abandonment of the gold standard in the United Kingdom in 1931. When the United Kingdom abandoned the gold standard in September 1931, Canada quickly followed suit because it had been under exactly the same pressure as the United Kingdom. The contraction of the money supply in the United States had been causing large amounts of gold bullion to flow west across the Atlantic Ocean, and south into the United States. The situation in South Africa was different, because gold exportation to London was a major business. According to Jan Smuts in his biography, the Nationalists specifically wanted to make a point of not automatically following suit with the United Kingdom, and they perceived that they were in a strong position to do so. For the United Kingdom and Canada, an outflow of gold was seen as a flight of gold, whereas for South Africa the same was seen as a profitable enterprise. The effect of South Africa's continuing adherence to the gold standard did not however turn out as Hertzog might have hoped. The South African pound rose dramatically in value against the pound sterling, and this virtually crippled South Africa's gold export industry overnight. By 1933, Hertzog abandoned the gold standard and the South African pound returned to parity with the pound sterling. The relief was felt almost immediately.

The South African pound was replaced by the rand on 14 February 1961 at a rate of 2 rand = 1 pound. That rate continued until the Sterling devaluation in 1967 when South Africa did not follow suit.

Coins

In 1892, the Transvaal Republic introduced coins in denominations of 1, 3 and 6 pence, 1, 2, 2½ and 5 shillings, ½ and 1 pond(pound). The last of these coins were issued in 1900, except for siege 1 pond coins issued in 1902.

The Union of South Africa issued coins from 1923, in denominations of ¼, ½, 1, 3 and 6 pence, 1, 2 (initially denominated as a florin) and 2½ shillings, ½ and 1 sovereign. The coins were the same weights as the corresponding British coins but the silver coins (3 pence up to 2½ shillings) were struck in .800 fineness silver. Gold coins were struck until 1932.

In 1947, 5 shilling coins were introduced, with occasional commemorative variants. In 1951, the silver coinage switched to .500 fineness. Gold bullion ½ and 1 pound coins were issued from 1952 in the same specifications as the ½ and 1 sovereign.

All the coins had the British monarch on the obverse, with the titles in Latin, while the reverse had the denomination and "South Africa" written in English and Afrikaans.

Banknotes

The government of the Cape of Good Hope issued a 1-pound note in 1835 and a 20-pound note in 1834. Between 1869 and 1872, the ZAR in Transvaal issued notes for 6 pence, 1, 2½, 5 and 10 shillings, 1, 5 and 10 pound. The National Bank of the ZAR issued 1 pound notes between 1892 and 1893. During the Second Boer War, government notes were issued in denominations of 1, 5, 10, 20, 50 and 100 pound.

In 1920, Treasury gold certificate notes were issued in denominations of 1, 5, 100, 1000 and 10,000 pounds. From 1921, the South African Reserve Bank took over the issuance of paper money, introducing notes for 10 shillings, 1, 5, 20 and 100 pounds. 20 pound notes were last issued in 1933, with 10 pound notes added in 1943.

All banknotes were bilingual in English and Afrikaans. From 1948, two variants of each note were issued, one with English written first and the other with Afrikaans written first.

See also

• Economy of South Africa

References