From Commodity to Colonial Currencies in West Africa

Introduction

This special issue explores a fundamental shift in the monetary and commercial history of West Africa, and in the general political economy of the region. To avoid confusion, it is important to begin by defining the nature of the transition. As researchers established more than half a century ago, the introduction of colonial currencies did not constitute a “monetization” of West African economies, in the sense of a conversion from barter to money. Rather, the systems for payment and for measuring and storing value within West Africa, in the several centuries before the European partition of the region began in earnest in 1879, were overwhelmingly based on the use of commodities as currencies, with barter playing at most an ancillary role.¹ The exception was the “assortment bargaining” that characterized the exchanges between African traders and—not fellow Africans but rather—their European counterparts during the Atlantic slave trade.² Assortment bargaining being anyway in the past by the time of the European partition of West Africa, the currency transitions that happened in the newly established European colonies, in the late nineteenth and early twentieth centuries, were shifts from one type of money to another: from commodity to fiat (token) currencies—though in concluding this article, I will qualify this way of describing the difference between precolonial and colonial currencies.

By definition, the transition to fiat currencies was fundamental in physical terms. This essay introduces the six research articles that follow, placing them in relation to the existing historiography. This is a tantalizing task, because though the literature has gaps, it is already rich. The first generation (or generation and a half) of economic historians of West Africa, in the 1950s to early 1980s, explored precolonial currencies and aspects of the transition to colonial currencies.³ There was a flourish of new studies in the 1990s.⁴ Then, and again within the last decade, renewed scholarly attention has been given to both precolonial currencies and the transition to colonial money.⁵

Whereas the most recent edited collections of papers have contemplated Sub-Saharan Africa as a whole,6 this one refocuses specifically on West Africa. Taking advantage of this narrower geographical range, we seek to explore in more depth the respective roles of states and African merchants in the selection and use of commodity currencies, including why nineteenth-century kingdoms did not mint their own coins; the extent to which early colonial states had to work with commodity currencies; and the drivers, commercial and fiscal, of the eventual adoption of colonial currencies by Africans as producers and tax-payers, in different settings from the desert-edge to the forest and coastal zones. In the process, we take further the debates about whether the shift to a different type of currency improved economic efficiency, reducing transactions costs and currency risks to the benefit of all, or how far they involved de facto expropriations from African holders of wealth.

Late Precolonial Trends and Patterns

Arguably, the dimension within which the currency transition was most fundamental was not economics but politics. In the precolonial era, certainly in the period for which we have most evidence, from c.1500 and especially from the seventeenth century, the choice of currency was made in principle by the parties to the transaction, in practice presumably by the merchants who to a great extent established the settings within which particular buyers transacted with particular sellers. Thus in most of West Africa the choice was not made and enforced by the state. For instance, from “the vantage point of the Western Sahel,” James Webb emphasizes that “there is no evidence that state power played any significant role in the formation, maintenance, or extension of the various currency zones” in the eighteenth and early nineteenth centuries.⁷ This underlines the weakness of most precolonial states; conversely, it highlights the strength of merchants, mercantile networks, and market forces.⁸ As Toyomu Masaki points out, there is a parallel with the crypto-currencies of the present, in that they were not generally regulated by the state.⁹ Is the twenty-first century world evolving, or regressing, towards the model of precolonial West Africa?

States in precolonial West Africa rarely insisted on a single currency within their territory (and territories tended to be loosely defined). For example, by the end of the seventeenth century, according to Robin Law, the cowrie seems to have been the only currency in use in Slave Coast markets, but he gives a market rather than state explanation for the disappearance of the iron currency that had previously existed alongside (and exchangeable with) the cowrie.¹⁰ Conversely, the largest state in nineteenth-century West Africa, the Sokoto Caliphate, did to some extent promote the use of cowries through its land tax demands. Though zakka, the tithe levied on grain, was “usually paid in kind,”¹¹ kurdin kasa, the land tax, which in most of the emirates was “the basic tax,” being paid on land farmed in the wet season, was “usually paid in money, that is, cowries.”¹² This is the most important exception in West Africa to the generalization that direct taxation paid in cash was a colonial innovation in the cause of monetization.¹³

But, so far, it seems that it was only in one polity in precolonial West Africa, the kingdom of Asante (Ashanti), c.1701–1896, that the state definitely prescribed one currency—gold dust—and proscribed all others;14 although the Borno state in what is now northeast Nigeria entered the cowrie zone in 1848 by government decision.¹⁵ Asante law required that all nuggets dug up within the kingdom should be sent to the capital to be pulverized into dust by state officials, after which a portion would be returned to the finder and the finder’s chief.¹⁶ This exception is consistent with the view that Asante was unusual among West African polities in the strength of its central government.¹⁷ In her concluding reflections in this special issue, Karin Pallaver draws an interesting comparison with the kingdom of Buganda, on the other side of the continent.

The Asante case raises the question why the kingdom did not take the further step of minting its own coins. That seems surprising, not least because gold coins (the Islamic dinar or mithqal) were known along trade routes in the northern hinterland of Asante. One source stated that they were mined in Nikii, a town in the savanna north of the kingdom of Dahomey. If so, it is unclear whether this was by command of the state of Borgu, in which it was located.¹⁸ In this special issue, Kofi Adjepong-Boateng addresses this question of why the Asante kingdom did not mint coins, showing that they had the technical capability to do so, and offers a political economy explanation.

The rarity of central control over currency before European colonization did not prevent currency reform—from below. In an important article of 1974, whose implications have yet to be fully digested, Paul Lovejoy highlighted the spread of cowrie shells as the medium of exchange over a wider and wider range in West Africa during the Atlantic trade.¹⁹ Because cowr0ies came only from the Indian Ocean—at that time, specifically from the Maldives—at first their supply to West Africa was restricted to what camel caravans could bring across the Sahara desert. The emergence of a sea route from the Indian Ocean, pioneered by the Portuguese, greatly reduced the cost of supply to West Africa. Over the eighteenth century, English and Dutch ships took 11.76 metric tons of these super-light shells to West Africa.²⁰ So cowries became readily available, and they were very widely adopted for all the functions of money: as a means of payment, a unit of account, and a store of value. By 1800, the majority of the territory and (apparently) population of West Africa used cowries as a currency.²¹ The Lower Niger was one of “many areas” in which cowries “circulated alone,” in the later eighteenth and early nineteenth centuries.²² Even more commonly, they operated as part of a combination of currencies. Cloth-strip currencies continued to be used to some extent across much of the northern savanna and Sahel (often locally woven, especially in the interior).²³ The main gaps in the cowrie zone were southeast Nigeria (brass manillas in the Niger Delta, copper wire in the Cross Rivers), Asante and other gold-producing Akan states, and Senegambia. In the Niger Delta, cowries as a cross-regional currency came to complement the flows of manillas in local circuits. Even Asante merchants could deal in cowries, though not within the heartland of the state: rather, in trade with the coast and with savanna merchants who Asante traders met in what Kwame Arhin called the “transit markets” on the savanna/forest edge.²⁴

The supply of gold usually came from within the region and the metal had intrinsic value. What made it an effective currency was the pulverizing of nuggets into dust, and the system of weights for measuring defined units of the latter. As indicated above, in Asante at least—the largest gold-dust regime—the state did the pulverizing and supervised the weights.

In Senegambia bars of locally produced iron were the established currency before the first Europeans arrived. The French and other Europeans intervened by selling iron on the coast; by 1800 the iron-bar had depreciated to the point where it had ceased to be a major currency. Pieces of cloth, known as guinée cloth, already a currency alongside iron bars, and also often supplied by French merchants, took over. But, by the beginning of the nineteenth century, with exceptions especially on the edges of the region, the spread of the cowrie currency was such that it had become the main currency, or the most-used part of a dual-currency system, in the majority of West Africa.

Indeed, Lovejoy highlighted the dissemination not just of the cowrie, but of a dual-currency system: cowries and gold, with the former being used for low-value transactions.²⁵ He noted that Marion Johnson had “documented the spread of a common currency over much of West Africa, throughout an area encompassed by Lake Chad in the east, the upper reaches of the Senegambia in the west, the southern Sahara in the north, and the region between the Volta basin and the Niger Delta in the south.”²⁶

Both the trend towards using cowries, and the trend towards combining them with gold mithquals or gold dust, can be seen as institutional reforms— in this case, changes in the informal rules—that would have reduced the costs of transacting. Compared to the commodity currencies that cowries partly or completely replaced, the shells had major technical advantages. They were impossible to forge with the available technology. Unlike iron, cloth, salt, silver or gold, cowries had little intrinsic value: the decorative use with which cowries are associated today can account for only a small fraction of the vast imports of shells during this period.²⁷ Again, unlike cloth, they were almost indestructible. They were also light, making them cheap to transport—unless their value depreciated. The technical advantages of cowries help to explain why they circulated alone in some areas, something rarely true of cloth currencies, for instance.²⁸ Again, the combination of gold dust and cowries would also have reduced transaction costs. The very high value/weight ratio of gold dust made it possible to move money cheaply over long distances, reducing the quantity of cowries that needed to be moved.

Conversely, the use of cowries to supplement a gold-dust currency in some auriferous districts solved the inherent problem with gold money, namely its lack of genuinely small change.²⁹ This problem was noted in areas that used gold but not cowries, such as the Gold Coast. The latter, or one part of it, provides a telling example of economic expansion—greater trade, greater returns on labor—resulting from currency reform that had apparently nothing to do with the state, namely the adoption of cowries as the means of paying for palm oil. According to Brodie Cruickshank, a veteran British merchant resident on the Gold Coast, the supply of palm oil for purchase by European traders had been constrained by a lack of means of payment for labor. Gold was limited in supply and too “little diffused”; barter items were mostly “very perishable … and, unless required for immediate consumption, of little use to the person receiving them.”³⁰ Hence, wrote Cruickshank, there was little incentive to put in the work required to supply palm oil. This situation was transformed from the late 1830s when cowries were introduced (evidently from European merchants’ stocks, and accepted by African brokers, carriers and farmers). After that:

labour could be very profitably employed in the manufacture of an article of great consumption, for which there was always a ready market, and which was paid in a commodity capable of great subdivision, and in constant use as the circulating medium of an extensive district of the country, motives for exertion were only limited by the extent of desire.³¹

Thus, ironically, “the shell money of the slave trade”³² became the instrument through which “legitimate commerce,” in palm oil, finally took off in its place.

In Asante, where it was “forbidden to sell or pass” cowries “under very severe penalties,”³³ one response to the problem of the limited diffusiveness of gold as a currency was that pottery was bartered for foodstuffs rather than sold for gold dust.³⁴ In the words of the colonial official and anthropologist R. S. Rattray, “This caused their manufacture to lie in the hands of the women folk … ‘as it was not worth the while of the men to make them.’”³⁵ However, barter was not the only solution. In his article, Adjepong-Boateng argues that Asante goldsmiths minted small, coin-like objects known as kakraa[s]. They were made with gold mixed with copper or silver. They were already in use as small change in the southern Akan states before the formation of the Asante kingdom (1701), including in states which were absorbed into the new kingdom during its early conquests.

The commodity currencies of precolonial West Africa only functioned as money, and were only considered as money, because West Africans—specifically, traders—chose to treat them as such. In Senegambia, Europeans sold iron to Africans; it was the latter who cut some of the iron into bars of roughly standard size, for use as currency. Likewise, cowries, guinée cloth for Senegal and the neighboring part of the western Sahel,³⁶ and brass manillas for eastern Côte d’Ivoire and the Niger Delta, as well as copper wires for the Cross River, were all sold by European ship captains as goods. It was West Africans who decided to use these materials as currencies. Conversely, according to Philip Curtin, silver coins were imported “in huge quantities” to Senegambia “up to the mid-eighteenth century, but they were destined to be melted down for jewelry. They may have been coined, but they were not money.”³⁷ Or rather, they were money for the European sellers, but not for the African users. Coins become currencies only when they are used as means of payment, and/or as scales of value and/or stores of value, in relation to the exchange of commodities other than themselves—by definition, unlike with barter. In an area spanning what is now the republic of Guinea, Liberia, and northern Côte d’Ivoire, iron was imported and minted into symbolic, standardized figures for use as a currency known as the sōmpe.³⁸ The Europeans did not accept these African currencies in payment. The importation of monetary materials, as Joseph Inikori has emphasized, was for the purpose of facilitating trade—not between Europeans and Africans— but among Africans themselves.³⁹ So the flow of imports of cowries and the other currency materials can be accepted as a metric of the expansion of the (nominal) value of intra-African trade.⁴⁰

Colonial-Period Transitions

The European colonizers would presumably have imposed their own currencies anyway, not least as a tangible, everyday sign of their sovereignty. It was only at the start of colonial rule that French administrators—for lack of alternative—accepted cowries and guinée cloth in payment of tax, as is shown in the articles in this special issue by Masaki and by Domenico Cristofaro and Seiji Nakao. It is ironic that it was only when the French had seized political “power” that they were prepared to accept commodity currencies as currencies, when “precolonial” French merchants refused them. In addition, Masaki’s article shows that in the area of the Upper Senegal River the French experienced serious complications in keeping account of the use of commodity currencies.

But the timing of the imposition of colonial currencies was relatively fortuitous, in that the system of commodity currencies was less robust than it had been in the eighteenth century. First, despite the accession of Borno to the cowrie zone, which increased the demand for shells and apparently at first caused a shortage of them in neighboring areas,⁴¹ the cowrie had depreciated considerably in the mid-nineteenth century, after European merchants started exploiting an additional source of supply from the Indian Ocean. This reduced the value/weight ratio such that it was no longer worth the cost of moving cowries far inland. Therefore, in single-currency cowrie systems, the use of cowries as a medium of exchange declined in interior markets, even if the shells retained their importance as a unit of account and store of value.⁴² Second, there was an increasing trend for silver dollars, imported from Austria, Spain and South America, to be used in intra-African transactions. These coins were popular because of their intrinsic value—their silver content—and they, too, were treated by West Africans, like cowries, as currency without the backing of a relevant state. Thus the buoyant commodity currency system of the eighteenth century was being undermined by the depreciation of the most widespread commodity currency, and by the intrusion of European coins, albeit ones treated as commodity currencies.

In monetary as in other affairs, the period during which most of West Africa was conquered by European powers should be distinguished from the period of relatively stable control that followed. There were major variations over space and the timing varied from place to place, but most of the violence and political instability happened within 1879–1903. Masaki’s article in this special issue captures the improvisation and sense of emergency of the period. She examines how the French government made its payments during the process of conquest itself, and the initial consolidation of colonial rule. The invading state’s supply of both silver coins and commodity currencies was very limited, and transport costs were high, with railways not yet having been built. Masaki shows that a key to the French ability to pay their soldiers and meet their other needs was credit: they bought silver coins from French firms with drafts on the treasury, so that they could pay their troops. They also transported purchasing power cheaply, again by using drafts on the treasury.

Let us turn to the significance of currency transitions in the early colonial period for economic efficiency, the distribution of wealth, and for the scope and strength of the state. Economically, fiat currencies are generally considered to have the advantage over commodity currencies of being potentially much cheaper, because their value is declared and supported by the state rather than depending on the intrinsic value of the materials of which the tokens are composed (this generalization does not work for cowries; a point to which we will return). Again, fiat currencies are potentially fully flexible in being usable up and down an infinite scale of transactions. From a government’s perspective, there is the advantage of being able to control the supply of money, and of obtaining revenue from seigniorage, the differential between the declared value of the notes and coins and the cost of producing them.

In the early years, however, these potential advantages of the fiat currencies imposed by colonial regimes were severely compromised. Paper notes were perhaps the purest form of token currency, in having minimal intrinsic value compared to coins. They were also likely to be cheaper to produce and transport. But in colonial West Africa they initially struggled for acceptance. During the First World War, faced with a shortage of supply of silver coins from Britain in December 1915—during the height of the cocoa-buying season—the West African Currency Board brought forward its plans to introduce paper money into the Gold Coast. In this exigency, it imported Treasury Bills and made them legal tender.⁴³ This was followed in 1916 by “the new West African currency notes.” The manager of the Bank of British West Africa in Kumasi reported that “at the present time, the up-country native prefers coins to notes; his principal objection being the ease with which, when hoarded, they get destroyed by insects, weather and fire.”⁴⁴

Paper currency encountered resistance or, more precisely, reluctance: the material was unsuited to the tropical climate, and therefore unlikely to endure for long, therefore compromising the function of money as a store of value. Paper notes were eventually accepted—after all, it is coins that are little-used today—but after a long struggle. This is documented and examined in this special issue by Ayodeji Olukoju for southern Nigeria. Akinobu Kuroda reports that in Nigeria as a whole, which accounted for more than half the population of West Africa, as late as 30 June 1935, notes comprised only 7.17% of the £9,995,244 of colonial currency in circulation.⁴⁵ That said, in his article Olukoju reports that paper currency “became steadily established” in Lagos and its hinterland.

The flexibility of a fiat currency system also proved hard to deliver, because of the classic problem of shortage of small change.⁴⁶ Patrick Manning reports that in Dahomey in (or by) 1910–1912, “it became common practice to place a premium on [the] small coins” and “a discount on coins of 50 centimes and larger.”⁴⁷

It may well be true overall, as Arhin argued for Asante, that the colonial fiat currencies eventually facilitated the further expansion of the market in West Africa,⁴⁸ leading to “near-total monetization” in the twentieth century.⁴⁹ This is saying a lot, considering that Arhin described the level of monetization in the precolonial kingdom thus:

[J]ust as in the economic sector the absence of barter in the market-place argues a high degree of monetization, so also in the social and political sectors, the substitution of monetary payments for gifts in kind at marriage and funeral ceremonies, and for the rendering of service in kind, or of allegiance in person, signifies an advanced degree of monetization.⁵⁰

In a sense the demonetization of commodity currencies and the imposition of colonial ones hindered trade across frontiers in West Africa. Although a particular currency or dual-currency system normally predominated in a particular market, precolonial marketplaces in most of the region (the Asante kingdom excepted) were open to exchanging a range of currencies—as were the traders who operated between them.⁵¹ We should not assume that having more than one currency, let alone more than one kind of money, in the same market is always dysfunctional. For instance, “Gresham’s Law,” that bad money drives out good, operates only when legal tender requires that moneys with different commodity values be exchanged at the same price.⁵² The plurality, in some cases multiplicity, of currencies was ended, at least in law, with the imposition of a sole legal tender in each given territory (again, this was not a change in Asante, except in the identity of the currency concerned).

In many areas cowries held out. But, as Kuroda has argued, this was at the cost of their being relegated, sooner or later, to functioning in local networks of exchange rather than being exchangeable across much of the region as they had been before.⁵³ Part of the context was that colonial frontiers impeded trade across West Africa; particularly in the French case, where government policy was to direct trade to the east-west railway, rather than to allow the export-import trade to orient itself towards the nearest ports, which happened to be in British territory. However, it has to be acknowledged—contrary to the “Balkanization” narrative of Samir Amin⁵⁴—that both British and French West Africa were enormous areas, within which there were opportunities for producers and traders to reach large markets, and potentially achieve economies of scale. We need more research on the extent of intra-African trade during colonial rule.⁵⁵

While colonial regimes did much to try to contain trade and currency movements in West Africa within their new borders, the resilience of older patterns of currency use, coupled with the imperative for French subjects to earn money to pay capitation (head tax), helped to stimulate seasonal labor migration from the sahelian and savanna territories of the French empire into the export-crop-growing zones of British West Africa, especially the Gold Coast and Nigeria.⁵⁶ To be sure, labor migration was a response to inequalities in the real economy, not just to a monetary phenomenon. It reacted to profound inequalities in the export-earning capacity of the drier interior of West Africa compared to the forest zone near the coast.⁵⁷ But a major part of labor movements in the colonial period were directed at literally earning the money required to pay tax in the French colonies. In their article in this special issue, Cristofaro and Nakao show for the Haute Volta/ Gold Coast border, that the combination of the resilience of the cowrie and the dynamism of migrant labor fundamentally qualified and compromised the new colonial frontiers.

The “precolonial” option of moving currency across borders without regard for state intermediation or regulation, that was renewed in the early colonial period, has remained an important tool for traders and others ever since. This was most conspicuous during what turned out to be the pre-”Structural Adjustment” period of the 1970s and early 1980s, when governments sought to sustain fixed exchange rates in difficult economic circumstances. When the official exchange rates were far above their market values, as in those years was often the case with the currencies of Ghana, Guinea and Sierra Leone, those official rates were mocked in parallel currency markets which could handle a high proportion of cross-border monetary transactions. That was a period when the state was in retreat in some West African countries. Once again, as before colonization, African traders had a crucial say in which currencies were exchanged and at what value.⁵⁸

Given the histories of resistance to colonial currencies, why did Africans adopt them, sooner or later, in large part or in whole? In a volume edited by Pallaver in 2022, Kuroda suggested that the key was export agriculture.⁵⁹ On the evidence presented in this issue, the answer differs between British and French West Africa—or more precisely, probably, between colonies whose economies came to be based on cultivation for export (which included the groundnut zone on both sides of the Senegal-Gambia border) and colonies reliant on the export of seasonal laborers to the export-growing zones. Gardner’s article confirms—with strong quantification—that export agriculture was the main driver of the use of colonial currency in British West Africa. Farmers both received notes and coins in exchange for their produce, and needed them to buy imported goods. In contrast, Cristofaro and Nakao show very clearly that tax was the main driver of the use of colonial currency in Haute Volta; a conclusion which is likely to stand for the rest of the arid interior.

Intriguingly, both these articles focus on the seasonal pattern of demand for currency and use seasonal difference in exchange rates as evidence for their conclusions. Seasonal contrast was indeed a striking characteristic of colonial economies in West Africa. As Gardner’s essay confirms with numbers, the volume of currency in circulation grew rapidly during the harvest but dwindled again afterwards.

As for the advantages to the state of control of the money supply and revenue from seigniorage, we need to consider the distinction between the interests of the imperial metropolis and the colonial administrations on the ground in West Africa. In his article in this special issue, Olukoju examines the repeated but unavailing efforts of the governor of Nigeria, Walter Egerton (1904–1912), to get a share of the profits from minting the currency used in the colony as a contribution to colonial rather than imperial revenue. Generally, the extent to which colonial administrations were able to take initiatives and persuade the imperial authorities to accept them varied across the range of state responsibilities. As the seigniorage issue illustrates, money was an area in which the metropolitan governments insisted on very closely laying down the law. Again, even had they wanted to do so, colonial governors did not have the autonomy to devalue the colonial currency against the metropolitan one. In 1880 British currency was made legal tender in the small collection of territories that then constituted British West Africa. However, the treasury in London was paranoid that the UK domestic monetary system might be flooded with silver coins repatriated from West Africa. Their solution, which was also adopted by other European empires in Africa, was an arm’s-length one: to create a specifically colonial currency, linked at a fixed exchange rate to the imperial currency at home. Eventually, the West African Currency Board was established, in 1912, to issue money specifically for British West Africa.

The wealth implications of demonetization of existing currencies by the new colonial regimes attracted some of the best of the early research on monetary history in West Africa, especially Walter Ofonagoro’s on southern Nigeria.⁶⁰ Demonetization of commodity currencies, and of third-party coins treated as commodity currencies in that they were not backed by a state, had contrasting implications for the distribution of wealth within the West African colonies. Demonetizing the currency in which wealth was stored could deprive the owner of value. Other things being equal, the effect was least where the existing currency had intrinsic value, which was the case with the gold dust currency which had been the only legal tender in the Asante kingdom until 1896, and which had also been in use in what became the Gold Coast Colony, the lands between Asante and the coast, over which Britain declared a protectorate in 1874.

Possession of some intrinsic value was not always sufficient to protect the currency owner against loss, however, where the colonial intervention was nakedly extractive. If we look slightly beyond West Africa in the strict sense, to German Kamerun, African holders of Maria Theresa silver dollars faced the loss of half their value when, in 1907, the administration halved the rate at which they were accepted in payment of taxes.⁶¹ Demonetization was most devastating when the existing currency had little or no intrinsic value, and the process was rapid. In between was the case of manillas in southeast Nigeria, where demonetization happened only after a long delay. Even then, holders of the old currency might secure much of its value. Ben Naneen found that Britain paid £401,135 to redeem manillas in 1948–1949, but got back only £135,000 when they were melted.⁶² Thus those who gave up their manillas received nearly three times their intrinsic value.

Reluctance to adopt colonial paper money has been mentioned above. In this special issue, Cristofaro and Nakao explore another form of resistance to the transition to colonial currencies, with the officially demonetized currency continuing to be used in calculating value and even as a medium of exchange in local marketplaces, as they show for the Haute Volta/Gold Coast border. An example of particularly strong resistance, continuing with cowries rather than adopting French currency—for five decades—was documented from the southwest of Haute Volta, by Mahir Şaul, making extensive use of both written and oral sources.⁶³

Continuity and Revolution

In a neglected article, Jan Hogendorn and Hank Gemery highlighted a major continuity in the monetary history of West Africa: the predominance of imports among the physical materials treated as currencies within West Africa, before, during and after colonial rule.⁶⁴ Indeed, the materials used as currencies in transactions in West Africa in the later precolonial period, by 1750 and onwards, were mostly imported.⁶⁵ Gold dust was an exception: cowrie shells were 100 percent imported, as were iron bars and manillas, and most of the cloth tokens that constituted the main currency of Senegambia and the adjoining part of the western Sahel. In part this was a response to scarcities within West Africa. For instance, while iron was mined and smelted within the region, output was limited by the supply of the right kinds of tree to make charcoal in iron-ore bearing areas.⁶⁶ But primarily, European firms developed specialisms in supplying forms of cloth or metal to West Africa which met the requirements of the emerging conventions in different parts of the region about what constituted cloth money or iron-bar currency or manillas. The fact that these supplies were external to the region, and in that sense at one remove to the internal markets, may even have strengthened confidence in the value of the currencies, because they were not subject to supply-side manipulation within the local or regional market in which they circulated. In the colonial period both coins and paper notes were 100 percent manufactured in Europe. After independence, European firms continued to produce notes and coins for African states. This was not confined to the West African franc (the CFA franc), which was part of the wider French monetary system, being fixed in value against the French franc (and later the euro), and supported by the French treasury. Besides the technical expertise of foreign companies in manufacturing notes and coins that were hard to forge, there was also the belief that secrecy was more easily maintained when new currencies were being imported rather than produced domestically. The most dramatic instance of this was during the Nigerian Civil War, when the federal government replaced its currency in the hope of rendering Biafra’s holdings of the old currency worthless, at least for international transactions. Reliance on—or at least regular use of—foreign firms to make the currency materials used by West Africans may have been rational, but can also be seen as one of the more obvious and enduring examples of the region’s economic dependence within the world economy.

Early work (1950s–1980s) on the introduction of colonial currencies saw it as “revolutionary”, notably in southern Nigeria.⁶⁷ More recent studies have placed more emphasis on the gradualness of change, on its mixed results in terms of ideals of monetary “modernization,” and on the fact that monetary systems, in Africa as elsewhere, keep evolving. Jane Guyer commented, in 1995, that

The further the colonial era recedes into the past … and the more closely one looks at communities rather than states, the less adequate seems the concept of “revolution,” with its implications of two different states of being, one of which totally supplants the other.⁶⁸

Guyer added that “Every few years throughout their entire history, Africans have incorporated currency change of varying provenance.”⁶⁹ It should be added, they have also initiated changes, such as the development of telephone-based mobile money in the early twenty-first century. The view of the currency transition in West Africa as gradual, uneven and—though very important—not what one would normally call revolutionary receives further support from the Pallaver volume.⁷⁰ This reinterpretation is taken further in this special issue. For the archetypal—and itself huge and varied—case of Southern Nigeria, Olukoju concludes, from a nuanced discussion of the evidence, that “the transition was gradual, protracted and problematic.” In her article, Gardner suggests that precolonial currencies were kept as a buffer against the hungry season, being converted into other assets such as cattle—and older currencies, such as manillas.

We have discussed the impact of demonetization of commodity currencies on the wealth of African elites. It might be instructive for Africanists to reflect on other models of currency as a source of impoverishment or inequality: not because there are exact parallels, but as a tool with which to think. For Roman Egypt, Thomas Laver presents a picture of a two-currency system, in which the elite enjoyed good access to gold coins, with which tax has to be paid, whereas the poor transacted with copper coins, except when they need to pay tax. That requirement led them into debt to money changers and others.⁷¹ Do the conditions for this model exist in West African history? Not before colonization. But the model is thought-provoking for the colonial period, when taxes often had to be paid in colonial currencies to which not everyone had ready access, especially if they lived outside the export-crop zones.

This special issue concludes with an article by Karin Pallaver, offering a comparative perspective from East Africa.⁷² As she says, the study of Africa’s monetary past, especially before colonization, took off more rapidly for West Africa than for East. But there is now a considerable body of work on East Africa, especially in the nineteenth century and later—to which Pallaver has contributed more than anyone. Her essay identifies a rich range of thought-provoking differences and similarities, from the even greater limits to political centralization in the precolonial period in East Africa, to the struggle which colonial governments went through in promoting their currencies. The comparison is much needed.

Finally, let us return to the definition of the transition. In the context of medieval Europe, Thomas Sargent and François Velde define commodity money as “money literally worth its weight in gold.”⁷³ They were referring to states who minted coins whose face value could only be maintained if it corresponded to the intrinsic value of the metal. Not until modern times were European states able to issue true token money. West Africa in the sixteenth to nineteenth centuries was different. Asante’s gold dust system, calibrated in carefully measured units of weight, was a commodity money in Sargent and Velde’s sense. But the most widely used currency in the region, certainly by 1800, was cowrie shells. Their exchange value did not depend on their intrinsic value which—given the vast scale on which they had been imported, was virtually nil. In that sense, cowries were a token currency, and the same could be said for manillas and even standardized cloth strips. It is a remarkable feature of the commercial world that West African traders made, that they and their customers accepted token money which was not even backed by a state. Conversely, the imposition of the colonial monetary regime, and its eventual acceptance by Africans, brought West Africa closer to the Eurasian norm of state-mandated currencies about which private traders and ordinary people might have varying degrees of confidence.

Acknowledgements

This special issue is open access thanks to the support of JSPS Kakenhi, Fund for the Promotion of Joint International Research (International Collaborative Research), Grant Number JP 24KK0030. The idea of this special issue goes back to a workshop convened by Toyomu Masaki and Gareth Austin at Clare Hall, University of Cambridge, 17 December 2019: “Money in West Africa: The Economic and Social History of the Transitions From Commodity to Colonial Currencies”. Half the research articles, however, began to be written much more recently, and the others have evolved.

For comments on earlier versions of this Introduction, I am grateful to Toyomu Masaki, Tony Hopkins, Leigh Gardner, Karin Pallaver and participants at the 2024 Cambridge-LSE Workshop on African Economic History. The article has also benefitted from the sharp eye of an AEH reviewer.