PHILIPSBURG--With the approval of the governments of Curaçao and St. Maarten, the Central Bank for Curaçao and St. Maarten (CBCS) is moving ahead with the project for the introduction of the Caribbean guilder.
The CBCS’ aim is for the Caribbean guilder to be introduced in 2024. Preparatory work for the introduction of the new currency began in 2019, but was suspended in 2020, pending the assessment by the IMF of the pros and cons of introducing a currency for the monetary union as opposed to dollarisation.
To assist the Countries in deciding whether or not to introduce a new currency, the CBCS prepared a decision document, which was submitted to the Finance Ministers of both Countries. Both governments have now confirmed their agreement with the new currency’s introduction.
Introducing a new currency has become necessary in view of the expected shortages in the stock of the different denominations of banknotes and coins of the Netherlands Antilles guilder.
Moreover, the outdated specifications of the current banknotes and coins, combined with modern technological developments, allow for the production of quality counterfeits. The risk of stock shortages and the inadequate security features represent a real threat to the public’s confidence in the existing legal tender and thus in the security and efficiency of the payment system as a whole.
Caribbean-guilder coins will be issued in the following denominations: 5 guilders, 1 guilder, 50 cents, 25 cents, 10 cents, 5 cents and 1 cent. For banknotes, the denominations will be 200 guilders, 100 guilders, 50 guilders, 20 guilders and 10 guilders. The NAf. 250-guilder banknote will be replaced by the 200 Caribbean-guilder note and the NAf. 25-guilder banknote by the 20 Caribbean-guilder note. The new denominations are more in line with the general international payment-system practices, such as in the case of the euro and the dollar. Like the NAf., the Caribbean guilder will be legally pegged to the US dollar at an exchange rate of US$1 = 1.79.
The assessment was requested by the CBCS in response to questions from politicians and civil society, sparked by the COVID-19 pandemic, on the pros and cons of the union introducing its own currency versus dollarisation.
CBCS said in a press statement that it will keep all its stakeholders regularly informed about the project’s progress. Banks as well as vendors using vending machines and point-of-sale devices, for example, have been involved from the very start, which is important so that adjustments to equipment and systems can happen in a timely manner. The public too will be kept informed of all relevant developments.
