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Rand (currency)

Template:Use South African English

South African rand
Suid-Afrikaanse rand (Afrikaans)
ISO 4217 code ZAR
Central bank South African Reserve Bank
 Website www.reservebank.co.za
Official user(s)  South Africa (Common Monetary Area member)
 Lesotho (Common Monetary Area member), alongside Lesotho loti
 Namibia, alongside Namibian dollar
Unofficial user(s)  Swaziland (Common Monetary Area member), alongside Swazi lilangeni
 Zimbabwe[1]
Inflation 3.6% (South Africa only)
 Source South African Reserve Bank, November 2010
 Method CPI
Pegged with Lesotho loti, Swazi lilangeni and Namibian dollar at par
Subunit
 1/100 Cent
Symbol R
Cent c
Plural rand
Coins 5c, 10c, 20c, 50c, R 1, R 2, R 5
Banknotes R 10, R 20, R 50, R 100, R 200

The rand (sign: R; code: ZAR) is the currency of South Africa. The rand has the symbol "R" and is subdivided into 100 cents, symbol "c". The ISO 4217 code is ZAR, from Dutch Zuid-Afrikaanse rand. (South African rand). Before 1984, the Dutch language was one of the official languages of South Africa.[2]

The rand is the currency of the Common Monetary Area between South Africa, Swaziland and Lesotho. Although Namibia withdrew from the Common Monetary Area, the rand is still legal tender there.

Historic users of the South African Rand were the former Bophuthatswana, Ciskei, Transkei and Venda.

Etymology

It takes its name from the Witwatersrand (White-waters-ridge in English), the ridge upon which Johannesburg is built and where most of South Africa's gold deposits were found.

History

The rand was introduced on 14 February 1961. A Decimal Coinage Commission had been set up in 1956 to consider a move away from the denominations of pounds, shillings and pence, submitting its recommendation on 8 August 1958.[3] It replaced the South African pound as legal tender, at the rate of 2 rand = 1 pound or 10 shillings to the rand. The government introduced a mascot, Decimal Dan, "the rand-cent man" to familiarise the populace with the new currency.[4] This took place in the same year that the Republic of South Africa was established.

Brief exchange rate history

A rand was worth US $1.40 from the time of its inception in 1961 until 1982, when mounting political pressure combined with sanctions placed against the country due to apartheid started to erode its value. The currency broke above parity with the dollar for the first time in March 1982, and continued to trade between R 1–R 1,30 to the dollar until June 1984, when depreciation of the currency gained momentum. By February 1985, it was trading at over R 2 per dollar, and, in July that year, all foreign exchange trading was suspended for 3 days to try to stop the devaluation.

By the time that State President PW Botha made his Rubicon speech on 15 August 1985, it had weakened to R 2,40 per dollar. The currency recovered somewhat between 1986–88, trading near the R 2 level most of the time and even breaking beneath it sporadically. The recovery was short-lived however, and by the end of 1989 the rand was trading at levels of more than R 2,50 per dollar.

As it became clear in the early 1990s that the country was destined for black majority rule and one reform after the other was announced, uncertainty about the future of the country hastened the depreciation until the level of R 3 to the dollar was breached in November 1992. A host of local and international events influenced the currency after that, most notably the 1994 democratic election which saw it weaken to over R 3,60 to the dollar, the election of Tito Mboweni as the new governor of the South African Reserve Bank, and the inauguration of President Thabo Mbeki in 1999 which saw it quickly slide to over R 6 to the dollar. The controversial land reform program that was kicked off in Zimbabwe, followed by the September 11, 2001 attacks, propelled it to its weakest historical level of R 13,84 to the dollar in December 2001.


This sudden depreciation in 2001 led to a formal investigation, which in turn led to a dramatic recovery. By the end of 2002, the currency was trading at under R 9 to the dollar again, and by the end of 2004 was trading at under R 5,70 to the dollar. The currency softened somewhat in 2005, and was trading at around R 6,35 to the dollar at the end of the year. At the start of 2006 however, the currency resumed its rally, and, as of 19 January 2006, was trading at under R 6 to the dollar again. However, during the second and third quarters of 2006 (i.e. April through September), the rand weakened significantly.

In sterling terms, it fell from around 9.5p to just over 7p, losing some 25% of its international trade-weighted value in just six months. Late in 2007, the rand rallied modestly to just over 8p, only to experience a precipitous slide during the first quarter of 2008.

This downward slide could be attributed to a range of factors: South Africa's worsening current account deficit, which widened to a 36‑year high of 7.3% of gross domestic product (GDP) in 2007; inflation at a five-year high of just under 9%; escalating global risk aversion as investors' concerns over the spreading impact of the sub-prime crisis grew; and a general flight to "safe havens", away from the perceived risks of emerging markets. The rand depreciation was exacerbated by the Eskom electricity crisis, which arose from the utility being unable to meet the country's rapidly growing energy demands.

In particular, major mines were shut down, with Eskom warning that major new industrial projects could not be powered until additional power generation capacity could be brought on stream, something unlikely to be achieved for at least another 5 years. This would have a significant impact on production and exports by South Africa's mining industry, and would thus worsen an already worrisome current account deficit. It is particularly unfortunate that this should have happened at a time of record high prices for hard and soft commodities. The situation has since stabilised.

Coins

Coins were introduced in 1961 in denominations of ½, 1, 2½, 5, 10, 20, 50 cents. In 1965, 2-cent coins replaced the 2½-cent coins. The ½-cent coin was last struck for circulation in 1973. The 2-rand was introduced in 1989, followed by 5-rand coins in 1994. Production of the 1- and 2-cent coins were discontinued in 2002, primarily due to inflation having devalued them, but they remain legal tender.[6][7][8] Shops normally round the total purchase price of goods to the nearest 5 cents (in favour of the consumer).

In an effort to curb counterfeiting, a new R 5 coin was released in August 2004. Security features introduced on the coin include a bi-metal design (similar to the €1 and €2 coins, the Thai 10 Baht coin, the British £2 coin and the Canadian $2 coin), a specially-serrated security groove along the rim and micro-lettering.[9]

Banknotes

The first series of rand banknotes was introduced in 1961 in denominations of 1, 2, 10 and 20 rand, with similar designs and colours to the preceding pound notes to ease the transition. They bore the image of Jan van Riebeeck, the first V.O.C. administrator of Cape Town. Like the last pound notes, they came in two variants, one with English written first and the other with Afrikaans written first. This practice was continued in the 1966 series which included the first 5 rand notes but did not include the 20 rand denomination.

The 1978 series began with denominations of 2, 5 and 10 rand, with 20 and 50 rand introduced in 1984. This series saw a major design change. In addition, the series has only one variant for each denomination of note. Afrikaans was the first language on the 2, 10 and 50 rand, while English was the first language on 5 and 20 rand. The notes bore the image of Jan van Riebeeck. The 1 rand note was replaced by a coin.

In the 1990s, the notes were redesigned with images of the Big Five wildlife species. 10, 20 and 50 rand notes were introduced in 1992, retaining the colour scheme of the previous issue. Coins were introduced for 2 rand and 5 rand, replacing the notes of the previous series, mainly because of the severe wear and tear experienced with low denomination notes in circulation. In 1994 notes were introduced for 100 and 200 rand.

The 2005 series has the same principal design, but with additional security features such as colour shifting ink on the 50 rand and higher and the EURion constellation. The obverses of all denominations are printed in English, while two other languages are printed on the reverses, thus making use of all eleven official languages of South Africa.

In 2010, the South African Reserve Bank and commercial banks withdrew all 1990 series R 200 banknotes due to relatively high quality counterfeit notes in circulation.[10]

In 2011, the South African Reserve Bank issued 100-rand banknotes which were defective because they lacked fluorescent printing visible under UV light. In June, printing of this denomination was moved from the South African Bank Note Company to Crane Currency’s Swedish division (Tumba Bruk), which reportedly produced 80 million 100-rand notes.[11] The South African Reserve Bank shredded 3.6 million 100-rand banknotes printed by Crane Currency because they had the same serial numbers as a batch printed by the South African Bank Note Company. In addition, the notes printed in Sweden were not the correct colour, and they were one millimeter short.[12]

On 11 February 2012, President Jacob Zuma announced that the country would be issuing a complete set of banknotes bearing Nelson Mandela's image.[13][14] They were entered into circulation on 6 November 2012.[15]

Banknotes of the South African rand (1961 First Issue)
Value Obverse Reverse Colour Language
1 rand Jan van Riebeeck Lion Brown Afrikaans, English
2 rand Jan van Riebeeck Lion Blue Afrikaans, English
10 rand Jan van Riebeeck Ship Green Afrikaans, English
20 rand Jan van Riebeeck Mine Purple Afrikaans, English
Banknotes of the South African rand (1970 Second Issue)[16]
Value Obverse Reverse Colour Language
2 rand Jan van Riebeeck and infrastructure Mining Blue Afrikaans, English
5 rand Jan van Riebeeck and diamonds Mining Maroon English, Afrikaans
10 rand Jan van Riebeeck and protea Agriculture Green Afrikaans, English
20 rand Jan van Riebeeck and Groot Constantia Jan van Riebeeck's landing party and South African Coat of Arms Brown English, Afrikaans
50 rand Jan van Riebeeck and lion Natural environment Red Afrikaans, English
Banknotes of the South African rand (1992 Third Issue "Big Five")[17]
Value Obverse Reverse Colour Language Size(mm)
10 rand Rhinoceros Agriculture Green Afrikaans, English 128x70
20 rand Elephants Mining Brown English, Afrikaans 134x70
50 rand Lions Manufacturing Red Afrikaans, English 140x70
100 rand Cape buffaloes Tourism Blue English, Afrikaans 146x70
200 rand Leopards Transport and communication Orange Afrikaans, English 152x70
Banknotes of the South African rand (2005 Fourth Issue "English & Other Official Languages")[16]
Value Obverse Reverse Colour Language Size(mm)
10 rand Rhinoceros Agriculture Green English, Afrikaans, Swati 128x70
20 rand Elephants Mining Brown English, Southern Ndebele, Tswana 134x70
50 rand Lions Manufacturing Red English, Venda, Xhosa 140x70
100 rand Cape buffaloes Tourism Blue English, Northern Sotho, Tsonga 146x70
200 rand Leopards Transport and communication Orange English, Sotho, Zulu 152x70
Banknotes of the South African rand (2012 Fifth Issue "Nelson Mandela")
Value Obverse Reverse Colour Language Size(mm)
10 rand Nelson Mandela Rhinoceros Green English, Afrikaans, Swati 128x70
20 rand Nelson Mandela Elephants Brown English, Southern Ndebele, Tswana 134x70
50 rand Nelson Mandela Lions Red English, Venda, Xhosa 140x70
100 rand Nelson Mandela Cape buffaloes Blue English, Northern Sotho, Tsonga 146x70
200 rand Nelson Mandela Leopards Orange English, Sotho, Zulu 152x70
Current ZAR exchange rates
From Google Finance: INR
From Yahoo! Finance: INR
From XE.com: INR
From OANDA.com: INR
From fxtop.com: INR

See also

References

Further reading

External links

  • US Federal Reserve Bank historical exchange rate data
  • South African Currency Page, with a short description of each note.
  • South African Currency Page (old rand), a short description of pre-1994 (apartheid-era) notes.
Preceded by:
South African pound
Reason: decimalization
Ratio: 2 rand = 1 South African pound = 1 British pound
Currency of South Africa
1961 –
Succeeded by:
Current
Currency of South West Africa
1961 – 1990
Note: administered by/occupied by South Africa since 1915
Currency of Namibia
1990 – 1993
Legal tender in Namibia
1993 –
Succeeded by:
Namibian dollar
Reason: withdrawal from Common Monetary Area
Ratio: at par
Note: dollar introduced in 1993, with South African rand remaining legal tender
Currency of Basutoland
1961 – 1966
Currency of Lesotho
1966 – 1980
Legal tender in Lesotho
1980 –
Succeeded by:
Lesotho loti
Note: loti introduced in 1980, with South African rand remaining legal tender
Currency of Swaziland
1961 – 1974
Legal tender in Swaziland
1974 – 1986
Circulates in Swaziland
1986 –
Succeeded by:
Swazi lilangeni
Note: lilangeni introduced in 1974. South African rand continues to circulate unofficially
Currency of Bechuanaland Protectorate
1961 – 1966
Currency of Botswana
1966 – 1976
Succeeded by:
Botswana pula
Reason: creation of independent currency
Ratio: at par
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