Abstract
This chapter argues that the setting in of structural poverty led to the widespread adoption of modern fiat currencies throughout the Red Sea World. From the late nineteenth century, communities throughout the region were being pushed into a cycle of poverty that weakened their resistance to imperial innovations and compelled them to abandon pre-colonial practices. By the end of the First World War, many had been forced into the money economy. Unfortunately, the war had destabilized European currencies and had led colonial officials to take active measures to replace traditional currencies with imperial ones. These new currencies, as well as the national currencies that succeeded them after independence, proved poor stores of values and therefore further trapped these communities in inescapable structural poverty.
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Notes
- 1.
For a brief history of this currency, see Adrian E. Tschoegl, ‘Maria Theresa’s Thaler: A Case of International Money,’ Eastern Economic Journal 27:4 (Fall 2001) 443–62.
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Joshua Teitelbaum, The Rise and Fall of the Hashemite Kingdom of Arabia (London, Hurst and Co, 2001) 76. Husayn came to conceptualize the presence of large quantities of foreign coins in Hijazi markets as an impediment to the full recognition of the legitimacy of his claim to sovereignty. So, Husayn’s government began to overstrike foreign coins with a symbol of his rule. When Husyan assumed the Caliphate in 1923, his government began to mint its own coins. Though they were intended to replace all foreign coins in circulation in the Hijaz, the coins were not widely accepted and soon disappeared from circulation. Foreign-minted silver and gold coins continued to be used in market transactions. Teitelbaum, The Rise and Fall of the Hashemite Kingdom of Arabia, 207.
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Acknowledgements
Researching and writing this chapter was made possible by grants from the Gerda Henkel Foundation, Social Studies and Humanities Research Council of Canada, the Alexander von Humboldt Foundation, the VolkswagenStiftung, the Andre W. Mellon Foundation and Harvard University’s Weatherhead Initiative on Global History.
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Serels, S. (2019). The Circulation of Modern Currencies and the Impoverishment of the Red Sea World, 1882–2010. In: Serels, S., Campbell, G. (eds) Currencies of the Indian Ocean World. Palgrave Series in Indian Ocean World Studies. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-20973-5_7
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