Gold Standard
Fixed gold value
SA Left Standard
December 1932
Last Sovereigns
1932
Archives
Wits University
Gold Standard and Economic History
How gold shaped South Africa's coinage – from the discovery on the Witwatersrand to the Krugerrand, and the dramatic 15‑month battle over the gold standard.
Key Dates
- Sept 1931 – UK leaves gold
- Dec 1932 – SA follows
- 1932 – Last gold sovereigns
- 1967 – Krugerrand launched
What Was the Gold Standard?
A monetary system where a country's currency had a fixed value in gold. Paper money could be exchanged for a specified amount of gold. South Africa, as the world's largest gold producer, had a unique relationship with the gold standard – it both benefited from high gold prices and suffered from the rigidities the system imposed.
🇿🇦 South Africa and the Gold Standard (1931–1932)
When Britain left the gold standard in September 1931, South Africa did not follow. Prime Minister Hertzog and Finance Minister Havenga were determined to maintain it, viewing it as a symbol of fiscal conservatism and independence. The controversy lasted 15 months, with intense political debate, bank runs, and capital flight. Finally, in December 1932, under massive pressure from capital outflows and a collapsing economy, South Africa abandoned the gold standard – a move that ultimately led to a sharp economic recovery.
Primary sources: Wits University archives hold extensive documents from the Transvaal Chamber of Mines, Gold Producers Committee, and correspondence of J.H. Hofmeyr – a crucial resource for understanding the economic and political dimensions.
Impact on Coinage
- Last gold sovereigns: Struck in Pretoria in 1932 – the final year of the Royal Mint branch's sovereign production.
- Royal Mint handover: The departure from gold paved the way for the transfer of the mint to South African control in 1941, becoming the independent South African Mint.
- Krugerrand (1967): The gold standard's end allowed gold to be treated as a commodity. This, combined with South Africa's dominant gold production, led to the creation of the Krugerrand – the first modern bullion coin, designed to facilitate private gold ownership.
Sources
- Wits University Archives: Gold Standard collection (1931–1933) – includes Transvaal Chamber of Mines records, Gold Producers Committee minutes, J.H. Hofmeyr papers.
- Cambridge University Press. "The gold standard controversy in South Africa."
- Ally, Russell. Gold and Empire: The Bank of England and South Africa's Gold Producers, 1886–1926 (1994).
- South African Mint historical summaries.