Zambian Kwacha

Zambian Kwacha
File:Zambia P-54 O.jpg 100 Zambian Kwacha
ISO 4217 code	ZMW ZMK until December 31, 2012
Central bank	Bank of Zambia
Website	www.boz.zm
User(s)	Zambia
Inflation	10.1%
Source	The World Factbook, 2015 est.
Method	CPI
Subunit
​1⁄100	ngwee
Symbol	ZK
Coins
Freq. used	5, 10, 50 ngwee and 1 kwacha
Banknotes
Freq. used	2, 5, 10, 20, 50, 100 kwacha
Printer	G&D Johan Enschede en Zonen
Website	www.gi-de.com www.joh-enschede.nl

The kwacha (ISO 4217 code: ZMW) is the currency of Zambia. It is subdivided into 100 ngwee.

Etymology

The name derives from the Nyanja word for "dawn", alluding to the Zambian nationalist slogan of a "new dawn of freedom". The name ngwee translates as "bright" in the Nyanja language.

History

Prior to independence, the Rhodesia and Nyasaland pound was the legal tender of the short-lived British protectorate of Northern Rhodesia. Banknotes of 10 shillings, 1, 5, and 10 pounds issued by the Central Africa Currency Board were in circulation, together with coins of ½, 1, 3, 6 pence, and 1, 2, 2½, and 5 shillings. After independence, the Bank of Zambia issued the first Zambian currency, the Zambian pound, in 1964. The issued paper bills and coins were of similar denominations as these used before independence, except for the 10 pounds note, which was never issued by the Bank of Zambia. A new design to depict the newly independent country's history and struggle was adopted. The two currencies - the Rhodesia and Nyasaland pound and the Zambian pound, were allowed to circulate in parallel until December 15, 1965, when the South Rhodesian pound bills and coins were withdrawn from circulation, except for the 3 pence coin which was allowed to circulate alongside its Zambian alternative for a brief period.

On July 1, 1966, the parliament approved the arrangements of the decimal currency system (Act 40 of 1966). The government voted in favor of decimalisation, and changing the main currency unit to Kwacha, with one kwacha being equal to 100 ngwee. The exchange rate was set to one kwacha equivalent to ten Zambian shillings, or one half of a Zambian pound. Thus, by January 16, 1968 all Zambian pound bills and coins were removed from circulation and replaced by the new kwacha bills, and ngwee coins. The Zambian pound bills of 10 shillings, 1, and 5 pounds were changed into 1, 2 and 10 kwacha respectively, a bill of 50 ngwee was issued to replace the old 5 shillings coin, alongside a new bill of 20 kwacha. Ngwee coins with the denominations of 1, 2, 5, 10, and 20 ngwee replacing the existing 1, 3, 6 pence, 1, and 2 shillings coins respectively. The Zambian pound notes, and coins ceased to be a legal tender on January 31, 1974.

At the very beginning, the kwacha was pegged to the pound at a fixed rate of 1.7094 kwacha per 1 pound. Yet, after the devaluation of the dollar on August 15, 1971, Zambia broke all its currency's ties to the British monetary unit, and pegged the kwacha to the American monetary unit. These reforms resulted in a reduction of the kwacha's gold standard by 7.8%. A few months later, the British Chancellor of the Exchequer Anthony Barber, announced the demise of the Sterling area, and floatation of the sterling pound, causing Zambia to renounce the monetary privileges once enjoyed as a member state.

Throughout the years, the Zambian currency suffered high rates of inflation forcing the Bank of Zambia to introduce high value denominations in 2003, including 20,000 and 50,000 kwacha bills to facilitate transactions. In 2013, a new, redenominated kwacha was introduced.

2013 rebasing

On 22 August 2012 the Bank of Zambia issued a press release stating that the changeover date for the rebased currency had been set as 1 January 2013. The new ISO code will be ZMW (formerly ZMK). Initial reaction to the move was positive. Razia Khan, head of Africa research at Standard Chartered commented saying, “The rebasing might be kwacha positive, to the extent that it is a continued commitment to low, and stable inflation”. On January 1, 2013 the new Zambian kwacha was introduced at a rate of 1000 old kwacha = 1 new kwacha. Until June 30, 2013 the old notes remained legal tender alongside the new kwacha notes.

Coins

5 kwacha in 1992
Coat of arms	Value

In 1968, bronze 1 and 2 ngwee and cupro-nickel 5, 10 and 20 ngwee were introduced. These coins all depicted president Kenneth Kaunda on the obverse and flora and fauna on the reverse. A twelve sided 50 ngwee coin was introduced in 1979 to replace the 50 ngwee note and featured commemorative FAO themes.

(click for image).

In 1982, copper-clad-steel replaced bronze in the 1 and 2 ngwee. These two were struck until 1983, with production of the 5 and 10 ngwee ceasing in 1987 and that of the 20 ngwee in 1988. Nickel-brass 1 kwacha coins were introduced in 1989 and depicted "Bank of Zambia" on the edges. The period of circulation for this coin was brief as inflation rates skyrocketed.

In 1992, a new, smaller coinage was introduced consisting of nickel-plated-steel 25 and 50 ngwee and brass 1, 5 and 10 kwacha. The coins depict the national crest on the obverse and native fauna on the reverse. The coins were issued only one year and then discontinued as the economic crisis dragged on.

All these coins, both from the older and newer series still remain legal tender. However, the value of the metal in the coins is worth more than their irrelevant face value, so they are never seen or used in normal trade. The only place coins might be seen today is when they are sold as souvenirs to tourists.

On January 1, 2013 new coins were introduced, namely for 5, 10, 50 ngwee and 1 kwacha.

Coins of the new kwacha (2013 series)

Denomination	Dates
5 ngwee	2013–present
10 ngwee	2013–present
50 ngwee	2013–present
1 kwacha	2013–present

Coins of the Zambian kwacha (2012 "Revaluation" issue)
Value	Technical parameters				Description			Date of issue
	Diameter	Thickness	Composition	Edge	Obverse	Reverse	Date
5 ngwee	19 mm	1.55 mm	Nickel-plated steel	Plain	Coat of arms of Zambia	Zambezi indigobird	2012	1 January 2013
10 ngwee	20 mm	1.57 mm	Brass-plated steel	Plain	Coat of arms of Zambia	Eland	2012	1 January 2013
50 ngwee	21 mm	1.60 mm	Brass-plated steel	Reeded	Coat of arms of Zambia	African elephant	2012	1 January 2013
1 kwacha	24 mm	1.73 mm	Nickel-plated steel	Reeded	Coat of arms of Zambia	Zambian barbet	2012	1 January 2013

Banknotes

The Currency Act of 1967 replaced the Zambian pound, shilling, pence currency for new kwacha and ngwee currency. Thus on 16 January 1968, the Zambian pound was replaced by the kwacha with the new official rate equal to one half the old unit, or US$1. The 5-pound note became 10 kwacha, the 1-pound note 2 kwacha, the 10-shilling note 1 kwacha, and a new 50-ngwee note was introduced to correspond to the old 5 shillings. At the same time, the currency was decimalized.

5 kwacha notes were introduced in 1973, the same year that the last 50 ngwee notes were issued. 50 kwacha notes were introduced in 1986, with the 1 kwacha note being replaced by a coin in 1988. 100 and 500 kwacha notes were introduced in 1991, followed by 1000, 5000 and 10,000 kwacha in 1992, when the 5 and 10 kwacha notes were replaced by coins and the 2 kwacha discontinued. In 2003, 20,000 and 50,000 kwacha notes were introduced.

Denomination	Dates
50 ngwee	1968-1973
1 kwacha	1968-1988
2 kwacha	1968-1989
5 kwacha	1973-1989
10 kwacha	1968-1991
20 kwacha	1968-1992
50 kwacha	1986-2013
100 kwacha	1991-2013
500 kwacha	1991-2013
1000 kwacha	1992-2013
5000 kwacha	1992-2013
10,000 kwacha	1992-2013
20,000 kwacha	2003-2013
50,000 kwacha	2003-2013

Until 1991, all Zambian banknotes featured a portrait of President Kenneth Kaunda on the obverse. After 1992, all notes have instead featured a fish eagle on the obverse. After 1989, all the reverses featured the Chainbreaker statue. In 2003, Zambia became the first African country to issue polymer banknotes. The 500 and 1000 kwacha were both printed on polymer. Although the old 20 kwacha note was still in circulation until 2012, such is the rarity of this note that most major retailers rounded prices up to the nearest 50 kwacha when calculating a total. Most items in major supermarkets were displayed using 20 kwacha in the value (e.g., 1980 kwacha).

Banknotes of the new kwacha (2013 series)

Denomination	Dates
2 kwacha	2013-
5 kwacha	2013-
10 kwacha	2013-
20 kwacha	2013-
50 kwacha	2013-
100 kwacha	2013-

See also

• Zambian Shillings
• Economy of Zambia

External links

• New Zambian coinage dated 2012

Preceded by: Zambian pound Ratio: 2 kwacha = 1 pound

Currency of Zambia 1968 – 31 December 2012

Succeeded by: Second kwacha Reason: convenience of exchange Ratio: 1 second kwacha = 1000 first kwacha

Preceded by: First kwacha Ratio: 1 second kwacha = 1000 first kwacha

Currency of Zambia 1 January 2013 –

Succeeded by: Current

Current ZMW exchange rates
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