Currencies of the British West Indies facts for kids

The British West Indies was a group of islands and mainland areas that were once controlled by Great Britain. These included places like Jamaica, Trinidad and Tobago, Barbados, Bermuda, and The Bahamas. It also included British Guiana (now Guyana) in South America and British Honduras (now Belize) in Central America. For a long time, these areas mostly used British money, called sterling. But over time, they slowly started using money based on the dollar.

Why Did Currencies Change?

In the early 1700s, Queen Anne tried to make the British pound the main money in the British West Indies. But people there mostly used Spanish dollars. These Spanish dollars were also called "pieces of eight." They were very common until 1873, when silver money lost a lot of its value.

Later, in 1825, the British government tried again to introduce British money. This happened for a few reasons. Britain had a strong money system based on gold, and they wanted to spread it to their colonies. Also, the supply of Spanish dollars was running out because of wars in Latin America, where most of them were made. The last Spanish dollar was actually made in Potosi, Jamaica in 1825. Britain also wanted a steady supply of their own shilling coins across their empire.

The Problem with the New Money

The 1825 plan didn't work well. It set an unfair exchange rate between the British pound and the Spanish dollar. It said one Spanish dollar was worth 4 shillings and 4 pence, which was too high. So, in 1838, a new, more realistic rate was set: one Spanish dollar was worth 4 shillings and 2 pence. Because of this, most of the British West Indies used British money from about 1840 until 1955.

The Sterling Area

When World War II started, a special group called the "sterling area" was created. This was to protect the value of British money during the war. All the British West Indies territories joined this group in 1939. Even British Honduras, which might have stayed out like Canada, joined in.

Even though British money was used, many places also kept track of money using both British pounds and dollars. Eventually, most territories switched completely to dollars, especially when they started using decimal coins (like our modern money with cents). Let's look at how this happened in different places.

British Honduras (Belize)

British Honduras, which changed its name to Belize in 1973, was the first British colony in the Caribbean to switch from British pounds to a currency based on the US dollar. This happened in 1885. The reason was that the dollar from nearby Guatemala had become so common that it pushed British money out of use. The leaders wanted to go back to a gold-backed currency. They chose the US dollar because they had strong trade with New Orleans in the USA. You can learn more about this at Belize dollar.

British Guiana (Guyana)

British Guiana, which became Guyana when it gained independence in 1966, was unique. It was the only territory in the British West Indies that used dollar accounts for both government and private businesses from 1839 to 1950. Even though British coins were used, they were always linked to the Spanish dollar at a rate of $1 = 4 shillings and 2 pence. British Guiana also had a special four pence coin called a groat. You can find more details at Guyanese dollar.

Bermuda

From 1842 until 1970, Bermuda officially used the sterling currency. This meant both the coins and how money was counted were based on the British pound. More information is available at Bermudian pound.

The Bahamas

Unlike Bermuda, The Bahamas also used the sterling system. However, the US dollar was also commonly used alongside the British pound, even though it wasn't official. See Bahamian pound for more.

Jamaica

Jamaica used British sterling coins and accounts from 1840 until 1969. But Jamaica was special because it had its own unique copper coins. While most other British West Indies territories used the same coins as the United Kingdom, Jamaica had its own versions. When Jamaica switched to a decimal system in 1969, its new Jamaican dollar was worth half a British pound. This meant Jamaica and the Cayman Islands were the only territories that continued to use a currency directly related to the British pound. Learn more at Jamaican pound.

Accompong: A Special Village

Accompong is a historic Maroon village in the hills of St. Elizabeth Parish, Jamaica. The Maroons were groups of formerly enslaved people who escaped and formed their own communities. They built a strong base in Cockpit Country in the 1600s and fought to stay independent from both the Spanish and later the British.

The village is named after an early African Maroon leader. In 1739, they signed a peace treaty with the British, which gave them certain rights to govern themselves. Even after Jamaica became independent in 1962, the government still respects the rights of the Jamaican Maroons in this area. In 2018, Accompong started issuing its own community currency called the LUMI, though the Jamaican Dollar is still widely used there.

The Cayman Islands

The Cayman Islands were once closely linked to Jamaica. So, their currency history was very similar to Jamaica's. You can find more information at Jamaican pound.

The Turks and Caicos Islands

The Turks and Caicos Islands were also linked to Jamaica. They followed Jamaica's currency path for a while. However, when Jamaica switched to the decimal system in 1969, the Turks and Caicos Islands decided to switch to the US dollar instead.

The Eastern Caribbean Group

The Eastern Caribbean group included Trinidad and Tobago, Barbados, the Windward Islands, and the Leeward Islands. These areas used British sterling coins. They also used a mix of sterling accounts and Spanish dollar accounts. Private banks often used Spanish dollar accounts, with one dollar equal to 4 shillings and 2 pence.

In 1949, this group formed a money union with British Guiana. Their currency was called the British West Indies dollar. Trinidad and Tobago left this arrangement in 1964. A new union was formed the next year, and the currency was renamed the Eastern Caribbean dollar. British Guiana left in 1966, and Barbados left in 1972. You can read more about these currencies at British West Indies dollar, Eastern Caribbean dollar, Trinidad and Tobago dollar, Guyanese dollar, and Barbados dollar.

The British Virgin Islands

Even though the British Virgin Islands were part of the Leeward Islands in the Eastern Caribbean, their currency situation was a bit tricky. This was because they were very close to the Danish West Indies (which became the US Virgin Islands in 1917). British sterling was the official money, but Danish krone and later US dollars were also widely used. When the British West Indies dollar was introduced in the British Virgin Islands in 1951, people protested. So, in 1961, the British Virgin Islands officially adopted the US dollar as its currency. See Eastern Caribbean dollar for more.

See also

• Sterling area
• List of British currencies
• International status and usage of the euro
• Central banks and currencies of the Caribbean
• Commonwealth banknote-issuing institutions
• List of Commonwealth of Nations countries by GDP
• List of stock exchanges in the United Kingdom, the British Crown Dependencies and United Kingdom Overseas Territories