Political sketch
Parts of present-day South Africa were formerly the Cape of Good Hope, Natal, Orange Free State (Orange River Colony), and Transvaal (South African Republic); also Griqualand and part of British Bechuanaland. Independent from the United Kingdom on 31 May 1910.
The Portuguese navigator Bartolomeu Dias sailed around the Cape of Good Hope in 1488. In 1652 the Dutchman Jan van Riebeeck established Cape Town as a stopping point for ships of the Dutch East India Company trading vessels. Dutch settlers became known as Boers (farmers) and later as Afrikaners. Interbreeding occurred among the San and Khoikhoins people and Afrikaners, resulting in an ethnic group known as Cape Coloureds. Afrikaners ventured inland from the Cape. They encountered the populous and settled agricultural Xhosa people in the area of the Fish River. In the last quarter of the 1700s minor cattle raids developed into frontier wars between the Afrikaners and Xhosa that were to last intermittently for almost 100 years. In 1795 the Netherlands were under French rule. British forces captured the Cape, relinquished control in 1802, and recaptured it permanently in 1806. In the 1830s many Afrikaners with their slaves migrated northward to escape British rule. They established the Orange Free State (in 1854; later called the Orange River Colony) and the South African Republic (in 1838; later called Transvaal). Diamonds were discovered in the Boer republics in 1868, and gold in 1886, leading the British to try to control them. Boer resistance led to the Boer War in 1899; major fighting ended ended with a British victory in 1900, but guerilla activity continued until a treaty was signed in 1902.
On 31 May 1910, the Cape Colony, Transvaal, Natal, and the Orange River Colony became independent from the United Kingdom as the Union of South Africa. During the First World War, South African sided with the United Kingdom. South African troops conquered German South West Africa (now Namibia) in 1915 and participated in the campaign against the German forces in Tanganyika (now Tanzania). In 1919 South West Africa became a South African mandate of the League of Nations. At various points in the 1900s South Africa tried but ultimately failed to incorporate Namibia, Botswana, Lesotho, and Swaziland. Throughout the century South African politics was dominated by race relations. Whites, especially Afrikaners, favored the policy of enforced racial segregation known as apartheid. The Nationalist Party, which came to power in 1948, reduced the rights that had been accumulated by Coloureds and blacks. Eventually it established small and fragmented tribal "homelands" for blacks as a way of stripping them of their South African citizenship. (The homelands were dissolved in 1993.) Blacks reacted with protests, including the protest of 1960 that became the Sharpeville massacre, and then with armed struggle under the umbrella of the African National Congress. In the mid and late 1970s the neighboring countries of Angola, Botswana, Mozambique, and Zimbabwe all became ruled by black majority governments. South Africa became increasingly isolated in international politics. It granted independence to Namibia in 1990, as the United Nations had demanded it do since 1968. It also began a transition to all-race democratic elections, which occurred in April 1994. The African National Congress won a majority of seats to the new parliament in these elections, and its leader Nelson Mandela became South Africa's first black president. South Africa is Africa's most economically advanced large country, with well developed agricultural, mineral extraction, industrial, and service sectors, but it has a large poor population and like many other African countries faces severe problems with AIDS.
Wars since 1500
(Except as noted, all the wars up to 1900 involved the Boers fighting against the Xhosa or Zulus): First Kaffir War, 1779; Second Kaffir War, 1793; Third Kaffir War, 1799-1801; United Kingdom occupation of the Cape of Good Hope (at the expense of the Netherlands), 1806; Fourth Kaffir War, 1811; Zulu Civil War of 1817-1819; Fifth Kaffir War, 1818-1819; Sixth Kaffir War, 1834-1835; Boer-Zulu War of 1838-1839 (also involved United Kingdom versus Zulus); Seventh Kaffir War (War of the Axe), 1846-1847; Eighth Kaffir War, 1850-1853; Ninth Kaffir War, 1877-1878; Zulu Civil War of 1856; Transvaal Civil War of 1862-1864 (among the Boers); Basuto War, 1865-1868; Zulu War, 1879; First Boer War (Transvaal Revolt, of Boers against United Kingdom), 1880-1881; Basuto Gun War, 1880-1881; Zulu Civil War of 1883-1884; Jameson's Raid, 29 December 1895-2 January 1896 (plotted by Cecil Rhodes against Transvaal Boer government); Great Boer War (Second Boer War, South African War), 1899-1902 (Boers against United Kingdom); First World War in Southern Africa (Germany against United Kingdom, France, Belgium, Portugal, etc.), 1914-1915; Boer Uprising of 1914-1915 (against the government); Namibian War of Independence, 1966-1990; Angolan Civil War, 1975-1991 (South Africa supported Angolan UNITA guerillas); Mozambican Civil and Guerilla Wars of 1976-1992 (South Africa supported Resistencia Nacional Mocambiçana [RENAMO] guerillas and battled against African National Congress [ANC] guerillas seeking refuge in Mozambique); South African Rebellion of 1990.
Convertibility
The sterling area:
On 2 August 1914, soon after the First World War began, the United Kingdom issued a proclamation imposing a one-month moratorium of payment for bills of exchange accepted before 4 August; an act of 3 August 1914 gave legislative sanction to the proclamation. The moratorium was subsequently extended for a month and ended on 4 November 1914. Legally the pound sterling remained convertible into gold and could be exported, but the risk to shipping from German submarines made the cost of shipment prohibitive, so the United Kingdom was in effect off the gold standard. The British government refused to include private shipments of gold in its war-risk insurance scheme. After the war, the export of gold was prohibited from 1 April 1919 under regulations that were given statutory form in 1920. On 28 April 1925 the government announced that the act would not be renewed when it expired on 31 December 1925. On 13 May 1925 the United Kingdom resumed the gold standard.
During the First World War, South Africa, Proclamation No. 225 of 14 December 1916 prohibited the export of gold.
The United Kingdom abandoned the gold standard on 21 September 1931. The currencies of British colonies were almost all linked to the pound sterling through currency boards; being on a sterling-exchange standard rather than a gold-exchange standard, they followed the pound sterling off gold. Over the next few years, some former British colonies (Australia, New Zealand, South Africa) and other countries that had important trade links with the United Kingdom switched from gold to the pound sterling as their official or actual anchor. The result was termed the sterling area. The United Kingdom imposed exchange controls on 4 September 1939, the day after entering the Second World War. Most countries that were not current or former British colonies soon left the sterling area. Among the remaining countries, both current- and capital-account transactions were free of restrictions within the sterling area, but were restricted in dealings with outside countries. After the Second World War, the United Kingdom returned to the gold standard under the Bretton Woods system. It removed exchange controls on 15 August 1947, but reimposed them on 20 August 1947 after suffering a large loss of foreign reserves. Sterling had a dual exchange rate from 1961 until the United Kingdom abolished exchange controls. The sterling area remained in existence because sterling was not fully convertible. It began to crumble after the United Kingdom again abandoned the gold standard on 23 June 1972. On that date, Botswana, Lesotho, South Africa, and Swaziland ceased being members of the sterling area; so did Namibia (then South West Africa), since it was subject to South African exchange controls. By January 1973 the sterling area had shrunk to the British Isles and a few small British colonies; even Hong Kong had abandoned sterling as its anchor currency. The United Kingdom abolished exchange controls on 24 October 1979, ending the sterling area.
South Africa imposed exchange controls for all countries outside the sterling area on 9 September 1939, shortly after the Second World War began. On 1 July 1949, it established a licensing system that restricted imports from the sterling area other than Northern and Southern Rhodesia (now Zambia and Zimbabwe). Compulsory surrender of sterling area currencies existed from 21 February 1956-27 February 1957, and was reintroduced 8 May 1958. Exchange controls intensified during 1961 (the legislative basis for subsequent exchange control being South Africa, "Exchange Control Regulations, Orders and Rules 1961," Government Notices R1111 and R1112 of 1 December 1961, issued in terms of South Africa, Currency and Exchanges Act, Act No. 9 of 1933). South Africa has been liberalizing exchange controls since 1995, but some persist today (2005).
The Rand Monetary Area (later Common Monetary Area):
Initially, Bechuanaland (now Botswana), Basutoland (now Lesotho) and Swaziland used South African currency and had no separate domestic units of account. Until 13 February 1961, South Africa's currency was called the pound; since 14 February 1961 it has been called the rand. In Namibia, then called South West Africa, three South African commercial bank issued notes from 1915 to 1961, but the unit of account was the South African pound; the other countries used notes issued by the South African Reserve Bank after it began issuing notes in 1922. These countries had a customs union and, by informal agreement, common exchange controls. Initially, South Africa paid no seigniorage to the other countries for using the rand. The Rand Monetary Area, established in 1974 (and renamed the Common Monetary Area from 1986) joined South Africa, Lesotho, Namibia, and Swaziland in a formal agreement. Botswana decided not to join, though it remained a member of the rand zone for purposes of exchange control until 1976. All the other countries now have their own currencies, equal to the South African rand, but South Africa still makes seigniorage payments to the other members of the zone based on estimated circulation of rand notes and coins within their territory.
South Africa alone:
A Cape of Good Hope proclamation of 23 January 1806 by the British military governor, just after the British had conquered the Cape, forbade the export of more than UK£10 of gold or silver. This proclamation said that previous Dutch and British governors had made similar prohibitions. The prohibition was removed by a governor's proclamation of May 1816.
Other
Recessions ("depressions") and financial crises mentioned by Arndt (1928): Cape of Good Hope: recession 1821 after Napoleon's death and consequent reduction of military garrison at Saint Helena, supplied via Cape Town; financial crisis and recession 1865-8, resulting mainly from a drought; financial crisis 1881, from setback in ostrich industry, end of diamond industry stock boom, and cessation of military spending in the interior with peace; financial crisis October 1890, after failure of Cape of Good Hope Bank, but it seemingly did not affect real economy much; recession 1893; perhaps problems connected with the Great Boer War, though Arndt (1928) does not discuss them; a general strike early 1922.
Defaults on or restructurings of debt to the private sector (mainly from Purcell and Kaufman 1993 and Standard & Poor's 2004): 1985-1987 (foreign currency bank debt), 1989 (foreign currency bank debt), 1993 (foreign currency bank debt); also, the Transvaal (South African Republic) and Orange Free State defaulted after losing the Great Boer War.
Reinhart and Tokatlidis (2000: 33) dating of recent financial liberalization: Domestic (notably interest rates) 1980, external (notably foreign-exchange market and participation by foreign financial institutions) 1983.
Banking crises (data since 1970s mainly from Caprio and Klingebiel 1999 and Frydl 1999): Failures of a few important banks 1890-1891; a moderate problem 1977, when Trust Bank was closed; moderate problems in 1985; moderate problems in 1989.
Bordo and Eichengreen (2001) list currency crises in 1975, 1978, 1981, 1982, 1984, 1986, 1987 (twin currency and banking crisis), 1988, 1992, 1992 (twin crisis), 1998.
Frankel and Rose (1996) list of currency crashes: None.
The tables below do not include the so-called tribal homelands established starting in 1976 because they had limited effective independence and none in monetary matters. The homelands (the nominally independent Bophuthatswana, Ciskei, Transkei, and Venda, plus the dependent Gazakulu, Kangwane, Kwa Ndebele, Kwa Zulu, Lebowa, and Qwaqwa) were dissolved after white minority rule ended in 1991.
References
Primary sources:
--Laws and decrees:
Cape of Good Hope. Gazette. 1800-1910. The Cape Town Gazette and African Advertiser (Kaapsche stads courant en afrikaansche berigter), later Government Gazette. Cape Town.
Great Britain (United Kingdom). Gazette. 1665-present. Oxford Gazette (1996-1666); London Gazette (1666-present). Oxford (1665-1666); London (1666-present): His/Her Majesty's Stationery Office from 1903. Online at <http://www.gazettes.online.co.uk>; as of September 2005, gazettes since 1900 are available.
Natal. Gazette. 1901-1910. The Natal Government Gazette. Pietermaritzburg.
Orange Free State (1900-1910, Orange River Colony). Gazette. 1861-1910. Gouvernements courant (1861-1900); Government Gazette of the Orange River Colony (1900-1910). Bloemfontein.
South Africa. Gazette. 1901-present. Official Gazette of the High Commissioner for South Africa (1901-1909); Gazette (1910-present; Afrikaans version Staatskoerant, 1961-present). Pretoria: Government Printer.
Transvaal (formerly South African Republic or Zuid-Afrikaansche Republiek). Gazette. 1881-1910. Staats courant der Zuid-Afrikaansche Republiek (1881-1899); Government Gazette (1900-1910). Pretoria.
--Publications of monetary authorities:
South African Reserve Bank. Annual report. 1920/1921-present. Report of the First [etc.] Ordinary General Meeting (1920/1921-1981/1982); Report of the Sixty-Second [etc.] Ordinary General Meeting of Stockholders (1982/1983-1986/1987); Report of the Sixty-Eighth [etc.] Ordinary General Meeting of Shareholders (1987/1988-present). Pretoria: South African Reserve Bank. (Some years also in Afrikaans.)
South African Reserve Bank. Bulletin. 1946-present. Quarterly Bulletin of Statistics / Statistiese Kwartaalblad (1946-1965); Quarterly Bulletin / Kwartaalblad (1966-1999); Quarterly Bulletin (no Afrikaans text) (1999-pressent). Pretoria: South African Reserve Bank.
South African Reserve Bank. Economic report. 1960/1961-present (annual). Annual Economic Report. Pretoria: South African Reserve Bank.
--Web site of the current monetary authority (viewed 20 September 2005):
<http://www.resbank.co.za>
--Other publications or Web sites:
IMF. International Monetary Fund. 1946-1971 (irregular). Schedule of Par Values. Washington: International Monetary Fund.
South Africa. Official yearbook. 1917-1960, 1974-present. Union Office of Census and Statistics (1917-1949); Bureau of Census and Statistics (1950-1960): Department of Information (1974-1993); South African Communication Service (1994-present). Official Year Book of the Union (1917-1918); Official Year Book of the Union and of Basutoland, Bechuanaland Protectorate and Swaziland (1919-1960); South Africa 1974 [etc.]: Official Yearbook of the Republic of South Africa (1974-1993); South Africa Yearbook (1994-present). Pretoria: Government Printing and Stationery Office (1917-1960); South African State Department of Information (1974-1993); South African Communication Service (1994-present).
Main secondary sources:
Amphlett, George Thomas. 1914. History of the Standard Bank of South Africa Ltd., 1862-1913. Glasgow: R. Maclehose. (I have not seen this in a long time because it has been at the bindery of the Library of Congress.)
Arndt, E[rnst] H[einrich] D[aniel]. 1928. Banking and Currency Development in South Africa (1652-1927) with an Appendix on the Rise of Savings Banking in South Africa. Cape Town: Juta and Company.
Barclays Bank (Dominion, Colonial and Overseas). 1938. A Banking Centenary: Barclays Bank (Dominion, Colonial and Overseas), 1836-1936. Plymouth, England: Mayflower Press, for private circulation.
Chalmers, [Sir] Robert. 1893. A History of Currency in the British Colonies. London: Eyre and Spottiswoode for Her Majesty's Stationery Office.
Crossley, [Sir] Julian [Stanley], and John Blandford. 1975. The DCO Story: A History of Banking in Many Countries 1925-71. London: Barclays Bank International. (Concerns Barclays Bank Dominion, Colonial and Overseas.)
De Kock, Gerhard [Petrus Christiaan]. 1954. A History of the South African Reserve Bank (1920-1954). Pretoria: J. L. van Schalk.
Engelbrecht, C[arel] L. 1987. Money in South Africa, translated by Anna Jonker. Cape Town: Tafelberg; Johannesburg: Thorold's Africana Books (distributor).
Gidlow, Roger M. 1995a. South African Reserve Bank Policies Under Dr. T. W. de Jongh, 1967-1980. Pretoria: South African Reserve Bank.
Gidlow, Roger M. 1995b. South African Reserve Bank Policies Under Dr. Gerhard de Kock, 1981-1989. Pretoria: South African Reserve Bank.
Henry, J[ames] A., and H. A. Siepmann. 1963. The First Hundred Years of the Standard Bank. London: Oxford University Press. (The Standard Bank operated widely in Africa.)
IMF ARER. 1950-present. International Monetary Fund. Annual Report on Exchange Restrictions (1950-1978), Annual Report on Exchange Arrangements and Exchange Restrictions (1979-1988), Exchange Arrangements and Exchange Restrictions: Annual Report (1989-present). Washington: International Monetary Fund. (Contains information on IMF member countries and some of their dependencies.)
South African Reserve Bank. 1971. South African Reserve Bank, 1921-1971: A Short Historical Review Issued in Commemoration of the Bank's Fiftieth Anniversary. Pretoria: South African Reserve Bank.
Webb, A. C. M. 1992. The Roots of the Tree; A Study in Early South African Banking: The Predecessors of the First National Bank, 1838-1926. Johannesburg: First National Bank of Southern Africa.
Monetary authorities: Cape of Good Hope (to 1910)
| Dates | Type | Name | Source | Remarks |
| 31 May 1782 [recheck
date in Arndt]
-15 September 1795 |
private monopoly issue (quasi governmental) | Vereenigde Oost Indische Compagnie (Dutch East India Company) (headquarters Amsterdam, Netherlands) | Cape of Good Hope, Dutch governor's announcement, 30 April 1782, cited in Arndt (1928: 5) | The Dutch East India Company issued notes to finance the colony's budget deficits and issue substitute currency for shipments of coins cut off by war. The first bank was the government-owned Bank van Leening (Lombard Bank), in Kaapstadt (now Cape Town), on 23 April 1793 (Cape Colony, proclamation of 15 March 1793, cited in Arndt 1928: 165 n. 4). |
| 16 September 1795
-31 July 1837 |
government issue | government of Cape of Good Hope (headquarters Kaapstadt / Cape Town, Cape of Good Hope) | Cape of Good Hope, British governor's proclamation of 1 January 1802, cited in Arndt (1928: 17), added to existing note issues, thereby effectively recognizing government responsibility for notes | Note issue in effect became fully a government responsibility when the British captured the Cape Colony from the Dutch on 16 September 1793. The colony returned to Dutch rule from 1803-1806 before coming under British rule again for the long term. On 12 August 1808, the government established the Lombard Discount Bank as a branch of the Lombard Bank (Arndt 1928: 178). The government outlawed the mainly small-denomination private promises to pay called "good fors" starting on 15 September 1822 (Cape of Good Hope, proclamation of 22 May 1822, cited in Arndt 1928: 31). Coins were struck in the Netherlands in 1802 but sent on to Indonesia because of the continuing threat of British seizure of the Cape Colony. |
| 1 August 1837
-31 March 1841 |
free banking alongside government issue | multiple note-issuing banks alongside government of Cape of Good Hope (headquarters Cape Town, Cape of Good Hope) | Cape of Good Hope, Cape of Good Hope Bank Deed of Settlement, 4 August 1836, cited in Arndt (1928: 236) and other bank deeds and charters, many cited in Arndt (1928: 508-10) | The Cape of Good Hope Bank (headquarters Cape Town, Cape of Good Hope), opened in Cape Town on 1 August 1837. It was the first note-issuing bank, and the first to break the government banking duopoly of the Lombard Bank and the Discount Bank. It was established without a government charter. The second bank was the South African Bank, in Cape Town (headquarters Cape Town, Cape of Good Hope), on 1 October 1838. It was likewise established without a government charter, instead using a Deed of Settlement of 23 August 1838 (Arndt 1928: 238). |
| 1 April 1841
-30 May 1910 |
free banking (more restricted from 1891; see Notes) | multiple note-issuing banks (28 by 1862) | Cape of Good Hope, proclamation of 1840, cited in Arndt (1928: 65) | In accord with the proclamation of 1840, the government withdrew its notes, which had frequently depreciated against silver or gold. After bank failures during the financial crisis of 1890 (perhaps related to the failure of the London investment bank Baring Brothers and a resulting decline of British foreign investment), the law was changed to require banks to back note issues with government bonds (Cape of Good Hope, Bank Act, No. 6 of 1891, cited in Chalmers 1893: 237). This restriction was a significant reduction of banking freedom. Prime minister Cecil Rhodes also understood the advantages for the government of a captive demand for its bonds. As an offset, the tax on bank notes was reduced from 1.5% to 1%. |
Monetary authorities: Natal (to 1910)
| Dates | Type | Name | Source | Remarks |
| 11 April 1849
-30 April 1854 |
dollarization | Cape of Good Hope pound (issued by multiple free banks) used on a customary basis | no legal enactment; Cape of Good Hope Ordinance No. 12 of 1845 (cited in Arndt 1928: 68) expressly provided that existing Cape legislation, which included currency legislation, should not apply to Natal | The first quasi bank was the Natal Fire Assurance and Trust Company, in Pietermaritzburg, on 11 April 1849 (established by Natal, Natal Fire Assurance and Trust Company Deed of Settlement, 1 May 1849, cited in Ardt 1928: 296). Its deed of settlement (stockholders' agreement) forbade it from issuing notes, though some local private merchants did so. Cape of Good Hope notes were used as early as 1837 (implies Arndt 1837: 68). Natal never had its own coins; it used mainly coins of the Cape of Good Hope, the United Kingdom, and later Transvaal. |
| 1 May 1854
-30 May 1910 |
free banking | multiple (11) note-issuing banks | Natal, Natal Bank Deed of Settlement, 21 April 1854, cited in Arndt (1928: 297), and other bank deeds and charters, many cited in Arndt (1928: 508-10) | The first note-issuing bank was the natal Bank (headquarters Pietermaritzburg, Natal), which opened in Pietermaritzburg on 1 May 1854. Many of the shareholders of the Natal Fire Assurance and Trust Company, including the company itself, were also shareholders of the Natal Bank. Arndt (1928: 297) places the opening of the Natal Bank at 1 April 1854 through a typographical error; Webb (1992: 27) has the correct date of 1 May 1854. The Natal Bank later received a charter (Natal, Ordinance No. 15 of 1856, cited in Arndt 1928: 297 n. 14). The second competing bank was the Standard Bank of British South Africa (headquarters London, England), in Durban, by the end of 1864 (Henry and Siepmann 1963: 6 n. 1). |
Monetary authorities: Orange Free State (Orange River Colony) (to 1910)
| Dates | Type | Name | Source | Remarks |
| mid 1862
-14 April 1865 |
free banking | multiple note-issuing banks | Orange Free State, Bloemfonteinsche Bank Act van Overeenkomst (deed of settlement), 19 June 1862, cited in Arndt (1928: 307-8, 508) and other bank deeds and charters, many cited in Arndt (1928: 508-10) | The Bloemfonteinsche Bank (also known as Bloemfontein Bank; headquarters Bloemfontein, Orange Free State) failed to obtain a government charter, so it opened without one, in Bloemfontein, in mid 1862. The second bank, the Fauresmith Bank (headquarters Fauresmith, Orange Free State), opened in Fauresmith in perhaps March of 1863, but closed by the end of the same year (Arndt 1928: 308). The Orange Free State never had its own coins; it used mainly coins of the Cape of Good Hope, the United Kingdom, and later Transvaal (e.g., Arndt 1928: 92). |
| 15 April 1865
-31 December 1883 |
government issue alongside free banking | government of Orange Free State (headquarters Bloemfontein, Orange Free State) "blueback" notes alongside multiple (9) note-issuing banks | Orange Free State, Volksraad (legislature) resolution of 10 March 1865; Volksraad resolution of 14 March 1865; both cited in Arndt (1928: 72 nn. 12, 13) | The government forced the "foreign" note-issuing Standard Bank of British South Africa (headquarters London, England), which had entered the territory in September 1863 (Arndt 1928: 308), to cease note issue and new business from 1 January 1866, so as to protect the local Bloemfonteinsche Bank (Orange Free State, Volksraad resolution proposed 6 March 1865, passed 7 March, cited in Arndt 1928: 315). The government lent its own "blueback" notes to the Bloemsfonteinsche Bank to help the bank. Government notes were depreciated until 1872. The Standard Bank closed its branch on 5 April 1868 (Arndt 1928: 317). A new Fauresmith Bank (headquarters Fauresmith, Orange Free State), opened in March 1873, and was absorbed by the Oriental Bank Corporation (headquarters London, England) in September 1875. When the Oriental Bank failed, the Bank of Africa (headquarters London, England) was established on 5 August 1879 to take over the Oriental Bank's South African branches (Arndt 1928: 318). The National Bank of the Orange Free State, partly |
| 1 January 1884
-30 May 1910 |
free banking | multiple note-issuing banks | Orange Free State, Volksraad resolution of 11 June 1866, cited in Arndt (1928: 76); Volksraad resolution of 5 June 1871, cited in Arndt (1928: 85 n. 22); Volksraad resolution of 9 June 1883, cited in Arndt (1928: 88) | The government had started withdrawing its notes from circulation in 1871 as economic growth and budget surpluses resulting from diamond discoveries permitted it to finance itself without resort to note issues. After the British victory in the Great Boer War (1900), other banks joined the Bank of Africa and the National Bank of the Orange River Colony, as the former National Bank of the Orange River State was renamed from 1900 (Orange River Colony, Proclamation No. 62 of 1900, cited in Arndt 1928: 331 n. 20). |
Monetary authorities: Transvaal (South African Republic) (to 1910)
| Dates | Type | Name | Source | Remarks |
| June 1865
-December 1873 |
government issue | government of Transvaal (headquarters Pretoria, Transvaal) "blueback" notes | Transvaal (South African Republic), Volksraad (legislature) resolutions of 9 June 1865; Government Notice No. 224, June 1865; all cited in Arndt (1928: 100 nn. 27, 28, 30) | The government issued securities (mandaten) starting in 1857 to finance its deficits, and government note issue was a continuation of that policy. The notes were depreciated until 1872. |
| December 1873
-1 February 1875 |
free banking alongside government issue | multiple note-issuing banks alongside government of Transvaal (headquarters Pretoria, Transvaal) "blueback" notes | Cape Province, Cape Commercial Bank Deed of Settlement, May 1854, cited in Arndt (1928: 241) and other bank deeds and charters, many cited in Arndt (1928: 508-10) | The first bank was a branch of the Cape Commercial Bank (headquarters Cape Town, Cape of Good Hope), in Pretoria, in December 1873 (Arndt 1928: 345). The second bank, the Standard Bank of British South Africa (headquarters London, England) opened its first local branch in Lyndenburg, by April 1874, according to Arndt (1928: 345), but Henry and Siepmann (1963: 50) say it was in Potchefstroom, on 2 May 1877. |
| 2 February 1875
-27 May 1900 |
free banking | multiple (10) note-issuing banks | Transvaal (South African Republic), Law No. 3 of 1873, cited in Arndt (1928: 114) | Government finances improved as a result of diamond discoveries, and the 1873 law provided for the retirement of government notes. De Nationale Bank der Zuid-Afrikaansche Republiek (National Bank of the South African Republic, headquarters Pretoria), had minority government ownership and was specially privileged from its opening 15 April 1891 until the Union period (South African Republic, Volksraad Resolution No. 1223, 8 August 1890, cited in Arndt 1928: 377 n. 10). The first coins were issued in 1892 (Arndt 1928: 142). |
| 28 May 1900
-15 May 1902 |
government issue alongside free banking | government of Transvaal (headquarters Pretoria, Transvaal) "Gouvernements Noten" alongside multiple note-issuing banks | Transvaal (South African Republic), Law No. 1 of 1900, cited in Arndt (1928: 119) | The government issued notes to finance its spending in the Great Boer War against the United Kingdom. |
| 16 May 1902
-30 May 1910 |
free banking | multiple note-issuing banks | United Kingdom, Army, commander-in-chief's Proclamation No. 8 of 1900, cited in Arndt (1928: 119-20) | Upon the British victory in the Great Boer War, the Transvaal government ceased issuing notes. The Proclamation by British Field Marshal Lord Roberts did not allow any of the government notes to be redeemed. By an agreement between the government and the National Bank of the South African Republic, approved by its shareholders on 6 February 1902, the bank was renamed the National Bank of South Africa (as of 1 July 1902) and had its privileges reduced (Transvaal, National Bank Concession Ordinance of 1903) (Barclays Bank [Dominion, Colonial and Overseas]: 1938: 132). Much later, in February 1926, Barclays Bank (Dominion, Colonial and Overseas) absorbed the National Bank of South Africa (Barclays Bank [Dominion, Colonial and Overseas] 1938: 189). |
Monetary authorities: South Africa (since 1910)
| Dates | Type | Name | Source | Remarks |
| 31 May 1910
-late December 1920 |
free banking | multiple note-issuing banks | pre-existing provincial law (summarized in Arndt 1928: 420-1) prevailed; the first union legislation (South Africa, Banks Act of 1917, cited in Arndt 1928: 454) made only minor changes | The Union of South Africa came into existence on 31 May 1910. Free bank notes remained the main type in circulation until 1922. |
| late December 1920
-29 June 1921 |
government issue alongside free banking | South Africa Treasury (headquarters Pretoria, South Africa) alongside multiple note-issuing banks | South Africa, Currency and Banking Act, No. 31, 17 December 1920, cited in De Kock (1954: 23, 47) | The government started to issue "gold certificates," and continued to do so to 31 March 1926. The certificates were intended as a temporary measure until the central bank, established by the same act, was operational. They were in fact not convertible into gold. |
| 30 June 1921
-present (2005) |
central bank | South African Reserve Bank or Suidafrikaanse Reserwe Bank (headquarters Pretoria, South Africa) | South Africa, Currency and Banking Act, No. 31, 17 December 1920, cited in De Kock (1954: 23, 47) | The central bank issued its first notes on 19 April 1922. South Africa began minting its own coins in 1923 (United Kingdom, Union of South Africa and Basutoland [Coinage] Proclamation, 23 January 1911, cited in Arndt (1928: 123); South Africa, Pretoria Mint Act, No. 45 of 1919, cited in Arndt (1928: 159); South Africa, Coinage Act, No. 31, August 1922; United Kingdom, Pretoria Mint Proclamation, 14 December 1922, cited in Arndt (1928: 123); South Africa, Proclamation No. 37, February 1923, cited in Arndt (1928: 160 n. 21). South Africa joined the IMF on 27 December 1945 as an original member. The central bank took over liability of coins from the Mint on 1 April 1993 (South African Reseve Bank annual report, 31 March 1994: 28). |
Exchange rate arrangements: Cape of Good Hope (to 1910)
| Dates | Official arrangement | Source | Unofficial arrangement, if different | Remarks |
| 7 April 1652
-about 1690 |
fixed; 1 Netherlands East India Company real (reaal van achten) = 1 Spanish real | Arndt (1928: 2) | Permanent Dutch settlement began at the start of the period. Even before this, Netherlands East India Company minted a real of the same weight and fineness as the Spanish real for colonial use only; it was used, but the Spanish real was the main currency actually in use in Cape of Good Hope. The Spanish real also circulated widely in the Netherlands. | |
| About 1690
-1770 |
fixed; 1 local rijksdaalder (rix dollar) = 1 Netherlands rijksdaalder | first mention of the rijsdaalder in a legal enactment is is Cape of Good Hope, Placaat of 1 July 1686, cited in Arndt (1928: 3) | The Dutch rijksdaalder (rix dollar), equal to 2-1/2 Dutch gulden (guilders), was the main unit of account. It was equivalent in silver value to the Spanish real. The local rijksdaalder was not officially separate from Dutch currency. In the Dutch monetary system of the time, 1 gulden = 20 stuivers (stivers) and 1 schilling (skilling) = 6 stuivers. Whereas 1 Dutch rijksdaalder = 8-1/3 schillings = 50 stivers, 1 Cape of Good Hope rijksdaalder = 8 Cape or Dutch schillings (skilling) = Cape or Dutch 48 stivers. | |
| 1770
-30 May 1782 |
fixed; 1 Cape of Good Hope rijksdaalder (rix dollar) = 0.96 Netherlands rijksdaalder | Netherlands, law or decree of 1770, cited in Arndt (1928: 5) | The Cape rijksdaalder had arisen as a unit of account separate from Dutch rijksdaalder because of commissions charged for exchange upon the Netherlands. The 1770 rating made 5 Cape rijksdaalders = UK£1. | |
| 31 May 1782 [recheck
date in Arndt]
-22 January 1806 |
pegged, 1 Cape of good Hope rijksdaalder (rix dollar) = 0.96 Netherlands rijksdaalder | Cape of Good Hope, Dutch governor's announcement, 30 April 1782, cited in Arndt (1928: 5) | In practice, a clean? float 31 May 1782 [recheck date in Arndt]-1784, 1790-April 1797, and early 1804-22 January 1806 (Arndt 1928: 8-9; Cape of Good Hope, Dutch governor's proclamantion, 18 January 1804, cited in Arndt 1928: 19 n. 23) | The Dutch East India Company (Verenigde Oostindische Compagnie) issued notes, so the exchange rate changed from fixed to pegged. On [date-see in Arndt] the notes were in effect made forced tender. This was a period of war between the Netherlands and Britain, and the Cape of Good Hope was cut off from supplies of Dutch coin. The end of war with the United Kingdom permitted new shipments of coins in 1784. The Netherlands East India Company systematically redeemed most of its notes and they circulated at par (that is, their face value against standard coins). In 1790 new issues of notes again made the value of government notes drop below par. By 1795, when the British conquered the colony, the discount was 20-30%. In April 1797 increased demand for currency had made the value of government notes again reach par (British governor's proclamation, 14 January 1800, cited in Arndt 1928: 16). In early 1804 new issues of notes again made the value of notes drop below par, to about a 33% discount in May 1805 (Cape of Good Hope, Dutch governor's proclamantion, 18 |
| 23 January 1806
-31 December 1825 |
pegged, 5 Cape of Good Hope rijksdaalders (rix dollars) = UK£1 | Cape of Good Hope, British governor's proclamations, 23 January 1806 and 12 June 1806; both cited in Chamers (1893: 231-2) | In practice, a clean? float; see Remarks. | The British discontinued the official rating for the Dutch guilder by the proclamation of 23 January 1806, but made small Dutch coins legal tender by the proclamation of 12 June 1806. The British continued to issue the government notes begun by the Dutch. The maximum discount of the notes from par was about 65% in July 1824; for a table of values 1806-1824, see Arndt (1928: 38-40). |
| 1 January 1826
-31 March 1841 |
pegged; local £1 = UK£1 = 13-1/3 Cape rix dollars, or 1 Cape rix dollar = UK 1 shilling 6 pence | United Kingdom, Order in Council of 23 March 1825; Cape of Good Hope, Ordinance No. 2, 6 June 1825, cited in Chalmers (1893: 235) | The pound became unit of account to conform with British colonial regulations attempting to propagate it throughout the British empire. The Cape rix dollar was silver, while sterling was a gold currency. The rix dollar continued to be used for some years afterwards as a customary unit of account. Bank notes were convertible into gold at the official rate of the pound sterling. The South African pound did not exist as a legally separate currency until 1920. | |
| 1 April 1841
-9 February 1882 |
fixed; local £1 = UK£1 = 13-1/3 Cape rix dollars, or 1 Cape rix dollar = UK 1 shilling 6 pence | Cape of Good Hope, proclamation of 1840, cited in Arndt (1928: 65) | The government ceased issuing notes, so the exchange rate became fixed. | |
| 10 February 1882
-30 May 1910 |
fixed; local £1 = UK£1 = 7.32238g gold | United Kingdom, Coinage Act of 1870 and proclamation under Order in Council of 29 November 1881; Cape of Good Hope, governor's proclamation, 3 February 1882, cited in Chalmers (1893: 236) | Silver coins were made clearly tokens, placing the currency firmly on a gold standard. |
Exchange rate arrangements: Natal (to 1910)
| Dates | Official arrangement | Source | Unofficial arrangement, if different | Remarks |
| 1845
-13 February 1882 |
fixed; used Cape of Good Hope rated currency | none; Cape of Good Hope Ordinance No. 12 of 1845 (cited in Arndt 1928: 68) expressly provided that existing Cape legislation, which included currency legislation, should not apply to Natal | The Boers entered Natal in 1837 and declared it a republic in 1839. Natal was declared a British possession on 10 May 1843. Before 1845, Cape of Good Hope legislation applied to Natal. United Kingdom, Order in Council and Proclamation of 10 November 1866, and Natal, Government Notice No. 15, 1 February 1867, made gold coins minted in Australia legal tender (cited in Chalmers [1893: 228]). However, the change was apparently never put into operation by a local proclamation. | |
| 14 February 1882
-30 May 1910 |
fixed; local £1 = UK£1 = 7.32238g gold | United Kingdom, Coinage Act of 1870 and proclamation under Order in Council of 29 November 1881; Natal, governor's proclamation, 3 February 1882, cited in Chalmers (1893: 229) | Ended the period of no official exchange rate legislation. The South African pound did not exist as a legally separate currency until 10 August 1920. |
Exchange rate arrangements: Orange Free State (Orange River Colony) (to 1910)
| Dates | Official arrangement | Source | Unofficial arrangement, if different | Remarks |
| 23 February 1854
-14 April 1865 |
fixed; local £1 = UK£1 = 7.32238g gold | Cape of Good Hope currency legislation apparently applied to Orange Free State during the period of British rule (3 February 1848-22 February 1852), and apparently was continued | The United Kingdom recognized the Orange Free State recognized as a republic on 13 February 1854. The rix dollar was used as a parallel unit of account, with the first government notes of 1865 being denominated in rix dollars (Arndt 1928: 71-3). | |
| 15 April 1865
-1872 |
pegged, local £1 = UK£1 = 7.32238g gold | Orange Free State, Volksraad resolution of 10 March 1865; Volksraad resolution of 14 March 1865; both cited in Arndt (1928: 72 nn. 13, 14) | In practice, a clean? float; see Remarks. | The government issued notes, changing the exchange rate from fixed to pegged. Intially the notes fell to 75% of their par value for a short time, then recovered to par value, but by 1866 they were worth only about 60% of their par value (Arndt 1928: 77). Coins disappeared from circulation because their metallic value exceeded their legal value. "Good fors," private promissory notes, were used for small change, and banks also issued small-denomination notes (Arndt 1928: 79). The notes had first been issued on 15 April 1865; intially they fell to 75% of their par value for a short time, then recovered to par value, but by 1866 they were again at a discount (Arndt 1928: 72-7) |
| 1872
-14? December 1899 |
pegged; local £1 = UK£1 = 7.32238g gold | Arndt (1928: 86) | From September 1899, when the Great Boer War began, a de facto debt moratorium was in place and it is unclear whether the pegged exchange rate held in practice. | Improving government finances allowed the Orange Free State to start retiring government notes in 1871, and they rose to par by 1872. The local pound was no officially separate from the pound sterling. |
| 15? December 1899
-14 March? 1900 |
pegged, local £1 = UK£1 = 7.32238g gold, but temporarily suspended | Orange Free State, Proclamation No. 600, 9 December 1899, cited in Arndt (1928: 331) | In practice, a clean? float. | The December 1899 proclamation declared a debt moratorium, legalizing what had already been happening in practice as a result of the Great Boer War, which had begun in September 1899. The starting date of 15 December 1899 is a guess based on the publication of the proclamation in the official gazette then. |
| 15 March? 1900
-30 May 1910 |
fixed; local £1 = UK£1 = 7.32238g gold | United Kingdom, Army, commander-in-chief's proclamation of 15 March 1900, cited in Arndt (1928: 331 n. 17) | The British army entered the capital city of Bloemfontein on 13 March 1900, and the military commander ended the debt moratorium by declaring void the December 1899 proclamation. The proclamation was not published in the government gazette until 29 June 1900. |
Exchange rate arrangements: Transvaal (South African Republic) (to 1910)
| Dates | Official arrangement | Source | Unofficial arrangement, if different | Remarks |
| 17 January 1852
-June 1865 |
fixed; local £1 = UK£1 = 7.32238g gold | Arndt (1928: 93) | Barter was widespread in practice. | Transvaal began as an independent entity on 17 January 1852. The rix dollar was used as a parallel unit of account to the pound until about 1868. |
| June 1865
-November 1872 |
pegged, local £1 = UK£1 = 7.3223g gold | Transvaal (South African Republic), Volksraad (legislature) resolutions of 9 June 1865; Government Notice No. 224, June 1865; all cited in Arndt (1928: 100 nn. 27, 28, 30) | In practice, a clean? float from June 1866; see Remarks. | The government began to issue notes, so the exchange rate changed from fixed to pegged. In June 1866 the government imposed forced tender for government notes, which were being accepted at only about 50% of their par value in some quarters, and later at only 25%.. The forced tender provision was for five years, later extended by the resolution of 1870 stating that the notes should be forced tender until they were all destroyed (South African Republic, Volksraad resolution of 11 June 1866, cited in Arndt 1928: 76; Volksraad resolution of 4 June 1870, cited in Arndt 1928: n. 18). |
| November 1872
-June 1900 |
pegged; local £1 = UK£1 = 7.32238g gold | South African Republic, Mint Law, Law No. 14 of 1891, approved by Volksraad Resolution No. 1325, 7 August 1891, cited in Arndt (1928: 141-2) | Government notes returned to par value in the market (Arndt 1928: 86). An improving economy and government finances permitted a cessation of new issues and ultimately the retirement of the existing government notes. The 1891 Mint Law established a local coinage because large deposits of gold had been discovered in the area. The law prescribed local coins equal in value to those of the British 1870 Coinage Act. The mint operated from 1892-1900, ceasing after British conquest. | |
| June 1900
-15 May 1902 |
independent? float | South African Republic, Law No. 1 of 1900, cited in Arndt (1928: 119) | This law allowed the government to issue notes to finance the Great Boer War and made the notes forced tender. This or another law declared a debt moratorium until 60 days after the end of the war. | |
| 16 May 1902
-30 May 1910 |
fixed; local £1 = UK£1 = 7.32238g gold | United Kingdom, Army, commander-in-chief's Proclamation No. 8 of 1900, cited in Arndt (1928: 119-20) | With the surrender of the South African Republic to British army, the republic's notes ceased to be legal tender by proclamation of the British commander-in-chief. The exchange rate reverted to a fixed rate. |
Exchange rate arrangements: South Africa (since 1910)
| Dates | Official arrangement | Source | Unofficial arrangement, if different | Remarks |
| 31 May 1910
-November 1914 |
fixed; local £1 = UK£1 = 7.32238g gold | previous provincial laws, modified slightly by United Kingdom, Union of South Africa and Basutoland (Coinage) Proclamation, 23 January 1911 and South Africa, Proclamation No. 135, 9 May 1911, both cited in Arndt (1928: 122-3) | The Union of South Africa came into existence on 31 May 1910. Previous provincial laws remained in force (De Kock 1954: 5). Transvaal coins were accepted as legal tender along with the coins of the United Kingdom and some British colonies. The South Africa Act of 1909, which unified the colonies into a single country, made no mention of currency and banking matters, nor was there any major legislation on the currency until the outbreak of the First World War (Arndt 1928: 122-3). | |
| 2 November 1914
-14 December 1920 |
fixed; local £1 = UK£1, and local £1 = 7.32238g gold | South Africa, Proclamation No. 243, 2 November 1914; Proclamation No. 225, December 1916; both cited in De Kock (1954: 7-8) | In practice, an indepdentent? float against gold. | A First World War embargo on the export of gold was imposed from 14 November 1914-July 1919. The government maintained the exchange rate with the pound sterling for approved foreign transactions. Domestically, though, bank notes were convertible into gold. This created losses for banks, who quoted sterling at its prewar parity rather than its depreciated value in terms of gold. In terms of gold, the pound sterling was worth about 75% of its par value in December 1919. |
| 15 December 1920
-17 May 1925 |
pegged; South African £1 = UK£1 | South Africa, proclamation of 15 December 1920, cited in De Kock (1954: 58) | This proclamation allowed government-issued gold certificates, issued by the end of December, to be inconvertible (as provided by South Africa, Currency and Banking Act, No. 31, 17 December 1920, cited in De Kock 1954: 23, 47). Gold redeemability of bank notes in effect apparently ceased at this point, which is also when it can be said that a separate South African pound came into existence. The name of the currency comes from the pound sterling. In the foreign exchange market, the South African pound was at a premium of up to 3% over the pound sterling. The embargo on the export of gold lapsed on 30 June 1922 (De Kock 1954: 56). Originally the inconvertiblity of gold certificates was to expire on 30 June 1923, but the Currency and Banking Amendment Act of 1923 allowed inconvertibility to continue for up to two more years (De Kock 1954: 57). | |
| 18 May 1925
-20 September 1931 |
pegged; South African £1 = UK£1 = 7.32238g gold | South Africa, recission of proclamation of 15 December 1920, 18 May 1925, cited in De Kock (1954: 78) | The United Kingdom had returned to gold standard on 27 April 1925. | |
| 21 September 1931
-27 December 1932 |
pegged; South African £1 = 7.32238g gold | South African Reserve Bank annual report, 6 July 1932: 2 | The South African pound began floating the against pound sterling when the United Kingdom abandoned the gold standard on 21 September 1931. | |
| 28 December 1932
-20 January 1933 |
managed? float | South Africa, Government Notice No. 1694, 28 December 1932, cited in De Kock (1954: 162) | The South African pound suffered a speculative attack when an important political figure, Tielman Roos, announced on 21 December 1932 his intention to resign his judgeship and form a coalition party to end the gold standard. South African exports were being hurt by South Africa not having followed other British Empire countries in devaluing against gold. | |
| 21 January 1933
-17 December 1946 |
pegged; South African £1 = UK£1 | South Africa, Currency and Exchanges Act, No. 9, 8 March 1933, cited in De Kock (1954: 195); De Kock (1954: 194) | RR: Parallel market premium against US dollar was less than that of the pound sterling, the anchor currency, from when data start in January 1946. | Pegged to the pound sterling. The act, though passed in March 1933, was retroactive to 20 January 1933. |
| 18 December 1946
-17 September 1949 |
pegged; South African £1 = UK£1 = 3.58134g gold = US$4.03 | possibly South Africa, Finance Act of 1946; IMF, 1st Schedule of Par Values, 18 December 1946: 4 | RR: Parallel market premium against the US dollar is no more than that of the pound sterling. | Registered a gold parity with the IMF. |
| 18 September 1949
-13 February 1961 |
pegged; South African £1 = UK£1 = 2.48828g gold = US$2.80 | South African Reserve Bank annual report, 26 July 1950: 6 | RR: Parallel market premium against US dollar is close to that of the pound sterling. | Followed the pound sterling's devaluation of 18 September 1949. |
| 14 February 1961
-17 November 1967 |
pegged; 2 South African rand = UK£1, or 1 South African rand = 1.24414g gold = US$1.40 | South Africa, Decimal Coinage Act, Act No. 61 of 1959, cited in South Africa, official yearbook 1960: 388 | RR: Parallel market premium begins to diverge from the low permiums of the pound sterling, and exceeds 10% at times. | Introduced a new currency at 2 South African rand = South African £1 as part of the decimalization of the currency. The name rand came from the Witwatersrand (Rand) region that contains many gold and diamond mines. |
| 18 November 1967
-22 August 1971 |
pegged; 1 South African rand = 1.24414g gold = US$1.40, or 1.71429 South African rand = UK£1 | South Africa, government announcement of 19 November 1967, cited in South African Reserve Bank bulletin, December 1967: 15; Minister of Finance, statement of 20 November 1967, reprinted in South African Reserve Bank bulletin, December 1967: 15 | RR: Parallel market premium persistently exceeds 10% from June 1970. | South Africa not follow when the United Kingdom devalued the pound sterling on 18 November 1967. The central bank suspended gold sales to the public on 8 April 1968 and thereafter dealt at the official rate only with other monetary authorities; this was important because South Africa was a leading gold producer. The government closed the foreign-exchange market on 16 August 1971 and allowed it to reopen on 24 August 1971. |
| 23 August 1971
-20 December 1971 |
pegged; 1 South African rand = US$1.40 = 1.24414g gold (nominally) | South Africa, Minister of Finance, statement of 23 August 1971, cited in South African Reserve Bank annual report, 24 August 1971: 14 | RR: Parallel market premium typically around 10%. | Gold convertibility for all countries ended in practice when the United States abandoned the gold standard on 15 August 1971. At the start of this period, South Africa switched from the pound sterling to the US dollar as its anchor currency. The government closed the foreign-exchange market on 17 December 1971 and allowed it to reopen on 22 December 1971. |
| 21 December 1971
-21 December 1971 |
pegged; 1 South African rand = US$1.33-1/3 = 1.09135g gold (nominally) | South African Reserve Bank annual report, 22 August 1972: 2; IMF ARER (1972: 382) | RR: Parallel market premium 8%. | Devalued to reduce a deficit in the balance of payments. The US dollar had been devalued against gold and major foreign currencies on 18 December 1971. |
| 22 December 1971
-24 October 1972 |
pegged; 1.95 South African rand = UK£1, or 1 South African rand = 1.09135g gold (nominally) | IMF ARER (1972: 383) | RR: Parallel market premium typically 10-20%. | Switched from the US dollar to the pound sterling as the anchor currency and devalued 4.76% against the US dollar. The exchange rate with gold remained unchanged. The foreign-exchange market closed on 23 June 1972, after the United Kingdom floated the pound sterling on the same day; the market reopened on 30 June 1972. |
| 25 October 1972
-13 February 1973 |
pegged; 1 South African rand = US$1.27732 = 1.04550g gold (nominally) | South African Reserve Bank annual report, 21 August 1973: 10; IMF ARER (1973: 422) | RR: Parallel market premium in single digits. Managed float. | Switched back again from the pound sterling to the US dollar as the anchor currency in belated reaction to the floating of the pound sterling on 23 June 1972. |
| 14 February 1973
-4 June 1973 |
pegged; 1 South African rand = US$1.4193 = 1.04550g gold (nominally) | South Africa, Minister of Finance, statement of 13 February 1973, reprinted in South African Reserve Bank bulletin, March 1973: 17 | RR: Parallel market premium 5-13%. Managed float. | Did not follow the devaluation of the US dollar on 13 February 1973. The foreign-exchange market closed on 2 March 1973 and reopened on 19 March 1973, following markets in London and elsewhere in Western Europe. |
| 5 June 1973
-23 June 1974 |
pegged; 1 South African rand = US$1.49 = 1.04550g gold (nominally) | South Africa, Minister of Finance, statement of 4 June 1973, reprinted in South African Reserve Bank bulletin, June 1973: 40 | RR: Parallel market premium typically in teens, peaking at 30%. Managed float. | Appreciated the central exchange rate against the US dollar by about 5% in response to the US dollar's weakness against gold, one of South Africa's major exports. |
| 24 June 1974
-26 June 1975 |
managed float; inoperative gold parity 1 South African rand = 1.04550g gold (nominally) | South Africa, Minister of Finance, statement of 21 June 1974, reprinted in South African Reserve Bank bulletin, September 1974: 15 | RR: Parallel market premium in low double digits. Managed float. | Floated. |
| 27 June 1975
-21 September 1975 |
pegged; 1 South African rand = US$1.40 = 1.04550g gold (nominally) | South Africa, Minister of Finance, statement of 27 June 1975, reprinted in South African Reserve Bank bulletin, September 1975: 17 | RR: Parallel market premium in low double digits. Managed float. | Adopted a firmer exchange rate; the previous middle rate had been 1 South African rand = US$1.47. |
| 22 September 1975
-1 February 1976 |
pegged; 1 South African rand = US$1.15 = 1.04550g gold (nominally) | South Africa, Minister of Finance, statement of 20 September 1975, reprinted in South African Reserve Bank bulletin, September 1975: 21 | RR: Parallel market premium typically in low double digits. Managed float. | Devalued against the US dollar because of a sharp fall in the US dollar price of gold. The exchange rate with gold remained unchanged. |
| 2 February 1976
-31 March 1978 |
pegged, dual rate; official rate 1 South African rand = US$1.15 = 1.04550g gold (nominally) | IMF ARER (1976: 404) | The second rate was a
flexible rate.
RR: Parallel market premium fluctuates considerably and peaks at 62% April 1976. Managed float. |
Some former "blocked rand" became tradable "securities rand" trading at market rates. In this case, introducing the dual exchange rate was part of an exchange liberalization, not, as often the case, a tightening of controls. |
| 1 April 1978
-28 January 1979 |
pegged, dual rate; official rate 1 South African rand = US$1.15 | International Monetary Fund, Board of Governors, Resolution No. 31-4, 30 April 1976 ("Second Amendment") | The second rate was a
flexible rate.
RR: Parallel market premium 0-28%. Managed float. |
The system of gold par values officially ended by agreement of IMF members. |
| 29 January 1979
-6 February 1983 |
independent float, dual rate (IMF: [category]; independent float category did not exist until 1982) | South Africa, Minister of Finance, statement of 24 January 1979, reprinted in South African Reserve Bank bulletin, March 1979: 27; IMF ARER (1980: [page on category], 1983: [page on category]) | RR: Parallel market premium 0-32%. | Floated as part of a further liberalization of exchange controls. |
| 7 February 1983
-1 September 1985 |
independent float | South Africa, Minister of Finance, statement of 5 February 1983, reprinted in South African Reserve Bank bulletin, March 1983: 25; IMF ARER (1984: [page on category]) | RR: Parallel market premium generally in single digits but peaking at 35% in July 1985. | Unified the exchange rate; the financial rand ceased to exist. The central bank temporarily closed the foreign-exchange market on 27 August 1985, allowing it to reopen on 2 September 1985 (South African Reserve Bank bulletin, September 1985: 6). Its action followed unrest in black townships and declaration of a state of emergency on 20 July 1985. |
| 2 September 1985
-12 March 1995 |
independent float, dual rate | South African Reserve Bank bulletin, September 1985: 12 | RR: Spikes including 1985 and 1987, when parallel market premium approached 40%. | Reintroduced the financial rand, more flexible than the official rate, in response to the problems created by political unrest. On 20 March 1992, the central bank announced it would intervene in foreign-exchange markets to influence the exchange rates of the commercial and financial rand (governor's statement on monetary policy, reprinted in South African Reserve Bank bulletin, June 1992: 25-8; IMF ARER 1993: 467). |
| 13 March 1995
-present (2005) |
independent float | South Africa, Minister of Finance, statement of 10 March 1995, reprinted in South African Reserve Bank bulletin, March 1995: 25 | RR: Parallel market premium in single digits except for an anomalous premium of 52% for December 1998, when data end. | Unified the exchange rate by abolishing the financial rand. South Africa introduced (or at least announced) inflation targeting on 23 February 2000 (Minister of Finance, Budget speech, 23 February 2000, reprinted in South African Reserve Bank bulletin, March 2000: 67-8). The initial target was for inflation of 3-6% by 2002. |