5 Kwacha
Sanny Olafeso
The name kwacha derives from the Nyanja, Bemba, and Tonga language 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.
On July 1, 1966, the parliament approved the arrangements of the decimal currency system (Act 40 of 1966), 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 notes and coins were removed from circulation and replaced by the new kwacha notes, and ngwee coins. The Zambian pound notes of 10 shillings, 1, and 5 pounds were changed into 1, 2 and 10 kwacha respectively, a note of 50 ngwee was issued to replace the old 5 shillings coin, alongside a new note of 20 kwacha.[3] 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.[4] The Zambian pound notes, and coins ceased to be a legal tender on January 31, 1974.[2]
At the very beginning, the kwacha was pegged to the pound sterling at a fixed rate of 1.7094 kwacha per 1 pound. Yet, after the devaluation of the US 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 flotation 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 inflation, forcing the Bank of Zambia to introduce high value denominations in 2003, including 20,000 bills to facilitate transactions. In 2013, a new, redenominated kwacha was introduced.[2] The value of Zambian currency dropped following redenomination; the exchange rate was 22 kwacha to one U.S. dollar in April 2021. After the 2021 Zambian general election saw a defeat for Edgar Lungu, the currency's depreciation was reversed; as of 27 August 2021[update] one U.S. dollar was exchanged for about 16 kwacha.[5] Since the inauguration of president Hakainde Hichilema in 2021, the kwacha has enjoyed a steady exchange rate hovering around 17 to 19 per one U.S dollar well into the year 2023, however following the drought, reduced economic activity and upto 15 hours of loadshedding to name a few current issues the economy has stagnated and the kwacha has since deprecated to an all time high of one U.S dollar per 27 Zambian kwacha.[6]
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.
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.
The Zambian kwacha was first issued in 1968 to replace the Zambian pound. The design of the kwacha bill changed as time went on, also, different bills were either introduced in or withdrawn from circulation. Seven emissions of the first kwacha are known to exist, while only one emission of the second kwacha was introduced in circulation on January 1, 2013, and still existing since then without any changes in design or security features. Each emission share similar general features in design throughout all the banknotes, with slight changes concerning the colors and the activity based theme on the reverse of the banknotes.
The first issue of the first kwacha was issued in 1968. The series comprised five banknotes of 50 ngwee, 1, 2, 10, and 20 kwacha. The obverse of the five banknotes featured a portrait of president Kenneth Kaunda in tribal outfit on the right, together with the Coat of Arms of Zambia on the left on the 50 ngwee banknote, or at upper center on the kwacha banknotes. The reverse showed different activity based themes reflecting life in Zambia. The banknotes were printed by Thomas De La Rue & Co. Limited, and bore the signature of Dr Justin B. Zulu, Bank of Zambia's second governor. Apart from the 50 ngwee banknote, the kwacha banknotes had president Kenneth Kaunda as a watermark. Specimen banknotes were issued for each denomination, with the word SPECIMEN overprint in red sans on both the obverse and reverse.
1 First Issued, refers to the year of first issue of the actual banknote from the same emission.
2 Last Issued: refers to the year of last issue of the actual banknote from the same emission.
During the second emission period, a commemorative banknote of 1 kwacha was issued in celebration of the declaration of One-party state on December 13, 1972. The banknote was not a legal tender, and had a different frame design than the banknotes of both, the first and second issues.
Later on in 1973, the Bank of Zambia issued the 5 kwacha banknote for the first time. A red-violet on multicolour underprint design was chosen for the new bill note. The new design resulted in a lot of confusion between the existing 50 ngwee bill and the new 5 kwacha one. This urged the Bank of Zambia to adopt a new design for the 50 ngwee banknotes in 1973. A new black and lilac on multicolor underprint was used for easy recognition, nevertheless, this was the last issue of the 50 ngwee banknotes as it was replaced later by a coin. The two new banknotes bore the signature of Mr Bitwell R. Kuwani, and were printed by Thomas De La Rue & Co. Limited. Specimen banknotes were issued for both denominations, with the word SPECIMEN overprint in red sans on both the obverse and reverse.
Prior to the third issue, short-lived designs of the obverses of the 10 and 20 kwacha banknotes were introduced. The new banknotes were printed by the English engraving, and printing company Bradbury, Wilkinson & Co. The new designs featured an older portrait of president Kenneth Kaunda, without the usual frame design, and bearing the signature of Mr Bitwell R. Kuwani. Specimen banknotes were issued for both banknotes, with the word SPECIMEN overprint in red sans on both the obverse and reverse. Thanks to their scarcity, both bills are the most expensive banknotes of the Zambian collection among notaphilists.
In 1976, a four bills third issue was issued, in which the old frame design was re-adopted once again. Banknotes with all denominations were reproduced, except for the twenty kwacha bill, which was never issued in spite of being redesigned. All bills bore the signatures of Mr Luke J. Mwananshiku, the fifth governors of the Bank of Zambia, except for the two kwacha banknotes, which retained the signature of Mr Bitwell R. Kuwani. The third emission banknotes were exactly similar to these of the second emission, except for president Kenneth Kaunda's portrait, where an older portrait replaced the younger portrait appearing on the first, and second emissions. The banknotes were once again printed by Thomas De La Rue & Co. Limited, and specimen banknotes were issued for each denomination, with the word SPECIMEN overprint in red sans on both the obverse and reverse.
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).
On January 23, 2012, the Bank of Zambia proposed certain measures in regards of the redenomination of the Zambian kwacha.[8] Such recommendations were initially approved by the government, being one of the measures required to address costs associated with the continuous devaluation of the national currency, due to depreciation throughout time, as a direct result of several years of high inflation rates that characterized the national economy during the late decades of the 20th century, and the early years of the 21st century.[8] The recommendations were assented to the parliament on November 3, 2012. Later, The Re-Domination of Currency Act (Act 8 of 2012) was enacted on December 3, 2012.[9]
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