Will the Caribbean guilder replace the Netherlands Antillean guilder by 2025? It is the question that is being considered by the Centrale Bank van Curacao in Sint Maarten or the Central Bank of Curacao and Sint Maarten.
The change in the guilder currency is one of the six goals involved in the CBCS Strategic Plan 2025. Specific details of the Strategic Plan were not publicly available at the time this article was written, however, according to the CBCS website, “Technological Advances, Climate Change, and the Events Triggered by the Global COVID-19 Pandemic and Its impact on the economy and the financial sector are causing changes in the scope and complexity of central bank operations and generating new risks that have yet to be identified. As a result, these banks are facing fundamental changes and are challenged to adapt to deal with these new realities.”
The website further explains: “The CBCS 2025 Strategic Plan is the result of extensive analysis. It was preceded by an in-depth survey among several of its external stakeholders in late 2020. The CBCS organization as a whole was actively involved in formulating the plan through a consultative and participatory approach.”
The plan to exchange one guilder for another has been under consideration since 2010. No action has yet been taken due to a discussion about the possible introduction of the dollar or the euro on the two islands. The former entities of the Netherlands Antilles, Bonaire, Sint Eustatius and Saba, became dollarized and adopted the US dollar as their official currency. Aruba, another former part of the Netherlands Antilles, issues the Aruban guilder when it left the Netherlands Antilles in 1986. The Caribbean guilder and the Netherlands Antillean guilder are legally pegged to the US dollar at a rate of 1.79.
Curaçao and Sint Maarten became “landen” or constituent countries within the Netherlands in 2010, following the dissolution of the Netherlands Antilles. Antillean guilder notes and coins ceased production in 2018, pending the currency exchange. Due to this decision made by the central bank, it is anticipated that the islands could run out of physical coins and bank notes within a few years. If this turns out to be true, an alternative currency such as the dollar or euro may need to function as a parallel currency.
The Antillean guilder circulates in denominations of 1, 5, 10, 25 and 50 cents, and 1, 2 1/2 and 5 guilders. Banknotes circulate in denominations of 10, 25, 50 and 100 guilders. Regional birds are the dominant vignette on banknotes.
The Netherlands Antillean guilder has continued to circulate since the dissolution of the Netherlands Antilles. Another possible floating currency proposal involves Curaçao and Sint Maarten issuing a Caribbean guilder pegged to the US dollar. This proposal has been delayed due to negotiations on a new central bank.
It has been proposed that the 2 1/2 guilder coin and circulating 25 guilder bank note denominations of the Netherlands Antillean guilder series should not be reissued, while bank notes in 20 and 200 guilder denominations they will be added to what is issued for circulation.
The Central Bank of Curaçao and Sint Maarten is the successor to the Bank of the Netherlands Antilles. The central bank is chaired by a president elected by the prime ministers of both islands. A supervisory board of directors is also appointed.
Following the dissolution of the Netherlands Antilles, Bonaire, Sint Eustatius and Saba became special municipalities similar to other municipalities within the European part of the Kingdom of the Netherlands. Curaçao and Sint Maarten chose an option through which the islands gained greater self-government. Along with the Netherlands and Aruba, the islands comprise the four autonomous countries within the Kingdom of the Netherlands.