Historical Sketch

The Dutch possessions in the West Indies consist of two separate island groups, the Windward Islands (Aruba, Bonaire, Curaçao) and the Leeward Islands (Saba, Sint Eustatius, Sint Maarten). Both groups were discovered for the Europeans by Spanish navigators in the 16th century. In 1634, the Dutch West Indies Company conquered Curaçao during the Spanish-Dutch War, and the other islands came under Dutch rule within a couple of years. until 1791. In 1815, the newly established Kingdom of the Netherlands took over the administration, intermittently together with Suriname on the South American Mainland. In 1845, the Colony of Curaçao (and Dependencies) was established comprising all islands territories. the colonial rule came out of Curaçao. In 1948, the colony was renamed to Netherlands Antilles and transformed into an overseas territory three years later. In 1986, the island of Aruba was the first to leave and became a Dutch territory of its own. The five other islands continued until October 2010 when the Netherlands Antilles were dissolved. Two of the islands, Curaçao and Sint Martin, followed the way of Aruba and became Dutch territories of their own, all three are considered "Constituent Countries of the Kingdom of the Netherlands", nominally on the same footing as the European part. The three other islands of Bonaire, Saba, Sint Eustatius opted for a complete integration into the Netherlands as "Special Municipalities" of the Caribbean.

Monetary History Overview

The Caribbean had always been an important station on the trade routes between the Spanish American possessions and Europe. Thus, Spanish trade coins got introduced and dominated the payment transactions, predominantly the so-called "Spanish Dollar", the eight Reals in silver. This was not any different in the Dutch possessions although the accounting was usually done in Guilders. In 1794, the colonial administration tried to introduce Dutch silver to displace the foreign trade coins. A series of coins specially designed for use in the West Indies was produced but did not gain acceptance in payments. In a next attempt in 1826, the Netherlands coinage and accounting was formally introduced, and foreign coins were demonetized except for the Spanish Dollar which obtained a Guilder rating. Due to a slight over-valuation of the Dollar, the local currency was devalued against the Netherlands Guilder so that after 1854, the Curaçao Guilder was no longer on par with the mainland currency. Around the same time, the Bank of Curaçao began issuing paper money, the sole commercial bank on the islands had begun operations in 1828. The notes were not convertible to specie or Dutch banknotes. After the governor's resolution of 1892, they were accepted for official payments. The Spanish Dollar was demonetized in late 1887 but its private use remained tolerated, its Guilder rating being so low that it quickly disappeared. Parity between the Dutch and the Curaçao currencies was re-established in 1899, and after 1901 local subsidiary coins were issued for the Caribbean territories. During the German occupation of the Netherlands, the West Indies remained under the rule of the government-in-exile, which caused the local and metropolitan currencies to decouple in May 1940. The Curaçao Guilder re-pegged to the US Dollar, which remained untouched after the end of World War II, the post-war devaluation of the Netherlands currency was not followed in the West Indies. The monetary order has remained unchanged since then with the exception of a small parity change after the US Dollar devaluation of 1971. In 1962, the Bank of the Netherlands Antilles took over the central bank function, why the currency became referred to as Netherlands Antilles Guilder after the reorganization of the Dutch possessions in March 1951, although there was no change in the monetary order.

The dissolution of the Netherlands Antilles in October 2010 also terminated the common currency area of the five islands. The constituents of the Caribbean Netherlands (Bonaire, Saba, St. Eustatius) opted for the full adoption of the US Dollar, rather than Euro, due to proximity with the Dollar area. This was effected in early 2011. Curaçao and Sint Maarten decided to maintain the common currency, to be renamed Caribbean Guilder. The Central Bank of Curaçao and Sint Maarten took over the authority for money issuance on the day the Netherlands Antilles were dissolved. The two constituent countries could, however, not agree on the further modalities for the central bank and the common currency. As a result, the Netherlands Antilles Guilder continued to circulate, and banknotes and coins were issued in the name of the defunct country and central bank. In 2022, Curaçao and Sint Maarten finally concluded an agreement, and the date for the introduction of the new currency was set to mid-2024. The Caribbean Guilder was to be introduced on par with its predecessor and with unchanged parity with the US Dollar. Further delays in the implementation of the agreement have postponed the introduction of the new currency to end March 2025.

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