TOPIC 2 - MONETARY SYSTEM DURING THE COLONIAL PERIOD.pdf

MONETARY SYSTEM DURING THE COLONIAL PERIOD PREPARED BY: ERRISH JAKE G. ABITONG FACULTY, FINANCIAL MANAGEMENT DEPT. DOMINANT CURRENCIES IN HISTORY Persian daric. The daric was a gold coin used in Persia between 522 BC and 330 BC. Roman currency. Currenci...

MONETARY SYSTEM DURING THE COLONIAL PERIOD PREPARED BY: ERRISH JAKE G. ABITONG FACULTY, FINANCIAL MANAGEMENT DEPT. DOMINANT CURRENCIES IN HISTORY Persian daric. The daric was a gold coin used in Persia between 522 BC and 330 BC. Roman currency. Currencies such as the aureus (gold), the denarius (silver), the sestertius (bronze), the dupondius (bronze), and the as (copper) were used during the Roman Empire from around 250 BC to AD 250. DOMINANT CURRENCIES IN HISTORY Thaler. From about 1486 to 1908, the thaler and its variations were used in Europe as the standard against which the various states’ currencies could be valued. Spanish American pesos. Around 1500 to the early nineteenth century, this contemporary of the thaler was widely used in Europe, the Americas, and the Far East; it became the first world currency by the late eighteenth century. DOMINANT CURRENCIES IN HISTORY British pound. The pound’s origins date as early as around AD 800, but its influence grew in the 1600s as the unofficial gold standard; from 1816 to around 1939 the pound was the global reserve currency until the collapse of the gold standard. US dollar. The Coinage Act of 1792 established the dollar as the basis for a monetary account, and it went into circulation two years later as a silver coin. Its strength as a global reserve currency expanded in the 1800s and continues today. Euro. Officially in circulation on January 1, 1999, the euro continues to serve as currency in many European countries today  FACT CHECK: Claim: The value of the peso against the US dollar started declining during the administration of former president Corazon Aquino. During the administration of the late dictator Ferdinand E. Marcos, the peso-dollar exchange rate was at P1 per dollar.  FACT CHECK: Fact: The value of the For December 1965, the month when the Marcos peso against the dollar administration started, the average peso-dollar was already declining exchange rate was already at P3.91 to $1. By February 1986, when Marcos was ousted and Aquino became under the Marcos president, the average exchange rate was at P20.46 to administration, $1 (month-end exchange rate for February 1986 was according to data from at P21.98 to $1). the Bangko Sentral ng Pilipinas (BSP) showing the monthly peso-dollar Contrary to the claim, the Philippine peso never exchange rates from achieved the P1 to $1 exchange rate during the Marcos years. According to BSP data, the average exchange 1945 onwards. rate was at P2 per dollar from 1945 to 1959, the highest level the Philippine peso has ever reached since 1945. MONETARY SYSTEM DURING COLONIAL PERIOD PHILIPPINE REPUBLIC AMERICAN PERIOD HISPANIC ERA PRE - HISPANIC ERA REVOLUTIONARY PERIOD JAPANESE OCCUPATION  PRE-HISPANIC ERA Long before the Spaniards came to the Philippines, trade among the early Filipinos and with traders from the neighboring lands like China, Java, Borneo, and Thailand was conducted through barter. The inconvenience of the barter system led to the adoption of a specific medium of exchange –the cowry shells. Cowries produced in gold, jade, quartz, and wood became the most common and acceptable form of money over many centuries. PRE -HISPANIC ERA The first local form of coinage was called Piloncitos. HISPANIC ERA The cobs or macuquinas of colonial mints were the earliest coins brought in by the galleons from Mexico and other Spanish colonies. These silver coins usually bore a cross on one side and the Spanish royal coat-of- arms on the other. The Spanish dos mundos were circulated extensively not only in the Philippines but the world over from 1732-1772. HISPANIC ERA Coins from other Spanish colonies also reached the Philippines and were counter-stamped to legalize their circulation in the country. Gold coins with the portrait of Queen Isabela were minted in Manila. Silver pesos with the profile of young Alfonso XIII were the last coins minted in Spain. The pesos fuertes, issued by the country’s first bank, the El Banco Espanol Filipino de Isabel II, were the first paper money circulated in the country. HISPANIC ERA The pesos fuertes, issued by the country’s first bank, the El Banco Espanol Filipino de Isabel II, were the first paper money circulated in the country. REVOLUTIONARY PERIOD Asserting its independence, the Philippine Republic of 1898 under General Emilio Aguinaldo issued its own coins and paper currency backed by the country’s natural resources. REVOLUTIONARY PERIOD At the Malolos arsenal, two types of two-centavo copper coins were struck. One peso and five-peso revolutionary notes printed as Republika Filipina Papel Moneda de Un Peso and Cinco Pesos were freely circulated. These were hand signed by Pedro Paterno, Mariano Limjap, and Telesforo Chuidian. AMERICAN PERIOD With the coming of the Americans in 1898, modern banking, currency, and credit systems were instituted making the Philippines one of the most prosperous countries in East Asia. The Americans instituted a monetary system for the Philippines based on gold and pegged the Philippine peso to the American dollar at a ratio of 2:1. The US Congress approved the Coinage Act for the Philippines in 1903. The coins issued under the system bore the designs of Filipino engraver and artist, Melecio Figueroa. AMERICAN PERIOD The coins issued under the system bore the designs of Filipino engraver and artist, Melecio Figueroa. AMERICAN PERIOD El Banco Espanol Filipino to Bank of the Philippine Islands in 1912 paved the way for the use of English from Spanish in all notes and coins issued up to 1933. AMERICAN PERIOD Beginning May 1918, treasury certificates replaced the silver certificates series, and a one-peso note was added. JAPANESE OCCUPATION The outbreak of World War II caused serious disturbances in the Philippine monetary system. Two kinds of notes circulated in the country during this period. The Japanese Occupation Forces issued war notes in high denominations. JAPANESE OCCUPATION These war notes had no backup reserves, thus, Filipinos dubbed it “Mickey Mouse” money. During the worst inflation in Philippine history. On the other hand, Guerrilla Notes or Resistance Currencies which are in low denominations, were issued by different provinces and, in some instances, municipalities through their local currency boards to show resistance against the Japanese occupation. THE PHILIPPINE REPUBLIC A nation in command of its destiny is the message reflected in the evolution of Philippine money under the Philippine Republic. Having gained independence from the United States following the end of World War II, the country used as currency old treasury certificates overprinted with the word “Victory”. VICTORY NOTES ENGLISH NOTES With the establishment of the Central Bank of the Philippines in 1949, the first currencies issued were the English series notes printed by the Thomas de la Rue & Co., Ltd. in England and the coins minted at the US Bureau of Mint. ENGLISH NOTES PILIPINO NOTES To complete the Filipinization of Philippine currency, the Central Bank started to issue the series of multi-colored Central Bank notes worded in Pilipino and similarly bearing the portraits of Filipino heroes on the reverse, and vignettes in Philippine history on the reverse toward mid-1969. This series called Pilipino series came in denominations 1, 5, 10, 20, 50 and 100. Pilipino Series Banknotes (1969-1974) Obverse Manuel Roxas Reverse Former Bangko Sentral ng Pilipinas Building Color Violet Pilipino Series Banknotes (1969-1974) Obverse Sergio Osmeña Reverse Legislative Building Color Red Pilipino Series Banknotes (1969-1974) Obverse Manuel L. Quezon Reverse Malacañang Palace Color Orange Pilipino Series Banknotes (1969-1974) Obvers Apolinario Mabini e Reverse Barasoain Church Color Brown Pilipino Series Banknotes (1969-1974) Obverse Andres Bonifacio Reverse Sanduguan or Blood Compact of the Katipuneros Color Green Pilipino Series Banknotes (1969-1974) Obverse Jose Rizal Reverse Declaration of Philippine Independence Color Blue Pilipino Series Coins (1969-1974)  Pilipino Series Coins (1969-1974) Obverse Jose Rizal, "Piso", "1" Reverse Seal of the Republic of the Philippines, "Bangko Sentral", year mark Pilipino Series Coins (1969-1974) Obverse Marcelo H. del Pilar, "Limampung Sentimos", "50" Reverse Seal of the Republic of the Philippines, "Republika ng Pilipinas", year mark Pilipino Series Coins (1969-1974) Obverse Juan Luna, "Dalawampu't Limang Sentimos" Reverse Seal of the Republic of the Philippines, "Republika ng Pilipinas", year mark Pilipino Series Coins (1969-1974) Obverse Francisco Baltasar, "Sampung Sentimos" Reverse Seal of the Republic of the Philippines, "Republika ng Pilipinas", year mark Pilipino Series Coins (1969-1974) Obverse Melchora Aquino, "Limang Sentimos" Reverse Seal of the Republic of the Philippines, "Republika ng Pilipinas", year mark Pilipino Series Coins (1969-1974) Obverse Lapulapu, "Isang Sentimo" Reverse Seal of the Republic of the Philippines, "Republika ng Pilipinas", year mark ANG BAGONG LIPUNAN SERIES (1975-1998) The Ang Bagong Lipunan (ABL) series was issued by the Central Bank of the Philippines in line with Presidential Decree No. 168 dated April 2, 1973. The Ang Bagong Lipunan (literally means New Society) legend overprinted on the banknotes was meant to symbolize then President Marcos’ New Society which marked the era of reforms on social, economic and political structure of the government. This legend was the main difference in the design between ABL and Pilipino series. The lowest denomination in the ABL series was 2-piso and the highest was 100-piso. The 2-piso denomination carried the design elements of the 1- piso Pilipino series. The ABL banknote series was considered demonetized after February 2, 1996. Ang Bagong Lipunan Series (1975-1998) Obverse Manuel Roxas Reverse BSP Complex Color Violet Ang Bagong Lipunan Series (1975-1998) Obverse Sergio Osmeña Reverse Legislative Building Color Red Ang Bagong Lipunan Series (1975-1998) Obverse Manuel L. Quezon Reverse Malacañan Palace Color Orange Ang Bagong Lipunan Series (1975-1998) Obverse Apolinario Mabini Reverse Barasoain Church Color Brown Ang Bagong Lipunan Series (1975-1998) Obverse Andres Bonifacio Reverse Sanduguan or Blood Compact of the Katipuneros Color Green Ang Bagong Lipunan Series (1975-1998) Obverse Jose Rizal Reverse Declaration of Philippine Independence Color Blue Ang Bagong Lipunan Coins (1975-1998) Ang Bagong Lipunan Coins (1975-1998) Obverse Pangulong Ferdinand Marcos", "Setyembre 21, 1972", "Ang Bagong Lipunan" Reverse Seal of the Republic of the Philippines, "Republika ng Pilipinas", "5 Piso" Ang Bagong Lipunan Coins (1975-1998) Obverse Jose Rizal, "Republika ng Pilipinas", "1 Piso" Reverse Seal of the Republic of the Philippines, "Ang Bagong Lipunan", "Bangko Sentral ng Pilipinas", year mark Ang Bagong Lipunan Coins (1975-1998) Obverse Juan Luna, “Republika ng Pilipinas” , “25 Sentimos Reverse "ANG BAGONG LIPUNAN," Seal of Central Bank of the Philippines, year of minting Ang Bagong Lipunan Coins (1975-1998) Obverse Francisco Baltazar, “Republika ng Pilipinas”, “10 Sentimos” Reverse "ANG BAGONG LIPUNAN," Seal of Central Bank of the Philippines, year of minting Ang Bagong Lipunan Coins (1975-1998) Obverse Melchora Aquino, "Republika ng Pilipinas", 5 Sentimos Reverse “ANG BAGONG LIPUNAN”, Seal of Central Bank of the Philippines, year mark Ang Bagong Lipunan Coins (1975-1998) Obverse Lapulapu, "Republika ng Pilipinas", "1 Sentimo" Reverse “ANG BAGONG LIPUNAN”, Seal of Central Bank of the Philippines, year mark FLORA AND FAUNA COIN SERIES (1983 – 1998) The Flora and Fauna series was introduced in 1983 which included 2-piso coins. The coins featured portraits of renowned Filipino patriots and heroes on the obverse and rare species of fauna, flora, and marine life indigenous to the Philippines were represented on the reverse. This series circulated simultaneously with 10-centavo English, all denominations of Pilipino and Ang Bagong Lipunan series. Flora and Fauna Series (1983 – 1998) Flora and Fauna Series (1983 – 1998) Reverse Obverse Cocos nucifera, 2 Piso Andres Bonifacio, "Republika ng Pilipinas", year mark Flora and Fauna Series (1983 – 1998) Reverse Obverse Anoa mindorensis (tamaraw), 1 Piso Jose Rizal, "Republika ng Pilipinas", year mark Flora and Fauna Series (1983 – 1998) Reverse Obverse Pithecophaga jefferyi (Philippine Marcelo H. del Pilar, "Republika ng Eagle/Monkey-eating Eagle), 50 Sentimo Pilipinas", year mark Flora and Fauna Series (1983 – 1998) Reverse Obverse Graphium idaeoides, 25 Sentimo Juan Luna, "Republika ng Pilipinas", year mark Flora and Fauna Series (1983 – 1998) Reverse Obverse Pandaka pygmaea, 10 Sentimo Francisco Baltasar, "Republika ng Pilipinas", year mark Flora and Fauna Series (1983 – 1998) Reverse Obverse Vanda sanderiana (Waling waling, a Melchora Aquino, "Republika ng rare and highly-prized orchid Pilipinas", year mark endemic to the island of Mindanao) Flora and Fauna Series (1983 – 1998) Reverse Obverse Voluta imperialis, 1 Sentimo Lapu lapu, "Republika ng Pilipinas", year mark IMPROVED FLORA AND FAUN COIN SERIES (1983 – 1998) The sizes of the coins were reduced in 1991 thus the Flora Fauna Series was renamed Improved Flora and Fauna. Along with this improvement was the introduction of 5-piso coin to replace the 5-piso banknote and save on the cost of printing considering that 5-piso banknote was the most widely circulated denomination. Other denominations of the Flora and Fauna such as the 50-, 10-, 5- and 1-sentimo were not anymore improved. This series together with the 10-centavo English, all denominations of Pilipino, Ang Bagong Lipunan and Flora and Fauna were considered demonetized after January 2, 1998. Improved Flora and Fauna Series (1983 – 1998) Improved Flora and Fauna Series (1983 – 1998) Reverse Obverse Pterocarpus indicus Emilio Aguinaldo and year mark Improved Flora and Fauna Series (1983 – 1998) Reverse Obverse Cocos nucifera Andres Bonifacio, "Republika ng Pilipinas", year mark Improved Flora and Fauna Series (1983 – 1998) Reverse Obverse Anoa mindorensis (tamaraw) Jose Rizal, "Republika ng Pilipinas", year mark Improved Flora and Fauna Series (1983 – 1998) Reverse Obverse Pithecophaga jefferyi (Philippine Marcelo H. del Pilar, "Republika ng Pilipinas", Eagle/Monkey-eating Eagle) year mark Improved Flora and Fauna Series (1983 – 1998) Reverse Obverse Graphium idaeoides, 25 Sentimo Juan Luna, "Republika ng Pilipinas", year mark NEW DESIGN SERIES (1985-2017) When Martial Law was lifted in 1981, the Central Bank started to print and mint an entirely new series of Philippine currency notes and coins which are contemporary and forward looking, adopting the latest trend of anti-counterfeiting features.  New Design Series (1985-2017) Obverse Composite portraits of Jose Abad Santos, Josefa Llanes Escoda and Vicente Lim, the heroes of World War II, all being at the forefront of the resistance force against the Japanese occupation of the Philippines Reverse Panoramic view of the Banaue Rice Terraces representing Luzon, Manunggul (boatmen journeying into eternity) representing the Visayas and Langgal (a Muslim mosque), representing Mindanao Color Blue  New Design Series (1985-2017) Obverse Benigno Aquino Jr., icon of Democracy Reverse Aquino, as a journalist; the Municipal Building in Concepcion and the Tarlac Provincial Capitol representing the seat of his political career; Study Now, Pay Later Plan, Aquino’s pet bill; a scene from EDSA People Power I and people from various sectors whose hands are interlocked together symbolizing unity and cooperation. Color Yellow  New Design Series (1985-2017) Obverse Diosdado Macapagal known for his land reform and social-economic agenda; he moved the celebration of Philippine Independence from 4 July to 12 June; at the lower right corner is Aguinaldo’s home in Cavite, now called Independence House, where the Philippine Independence in 12 June 1898 was declared Reverse EDSA II with Gloria Macapagal-Arroyo being sworn in as the President of the Philippines as a result of EDSA People Power II  New Design Series (1985-2017) Obverse Manuel Roxas Reverse BSP main building Color Violet  New Design Series (1985-2017) Obverse Sergio Osmeña Reverse National Museum Color Red  New Design Series (1985-2017) Obverse Manuel L. Quezon Reverse Malacañan Palace Color Orange  New Design Series (1985-2017) Obverse Apolinario Mabini, a political philosopher and revolutionary who wrote a constitutional plan for the first Philippine Republic of 1899-1901 and served as its first prime minister in 1899. Reverse Barasoain Church, where the drafting of the Malolos Constitution and the inauguration of the First Philippine Republic took place Color Brown  New Design Series (1985-2017) Obverse Emilio Aguinaldo Reverse Declaration of Philippine Independence Color Green New Design Series (1985-2017)  New Design Series (1985-2017) Obverse Reverse Apolinario Mabini and Andres Bonifacio, Logo of the Bangko Sentral ng Pilipinas "Republika ng Pilipinas", 10 piso, Year mark  New Design Series (1985-2017) Obverse Reverse Emilio Aguinaldo, "Republika ng Logo of the Bangko Sentral ng Pilipinas Pilipinas", 5 Piso, year mark  New Design Series (1985-2017) Obverse Reverse Jose Rizal, "Republika ng Pilipinas", 1 Logo of the Bangko Sentral ng Pilipinas Piso, year mark  New Design Series (1985-2017) Obverse Reverse 25 Sentimo, "Republika ng Pilipinas", Logo of the Bangko Sentral ng Pilipinas year mark  New Design Series (1985-2017) Obverse Reverse 10 Sentimo, "Republika ng Pilipinas", Logo of the Bangko Sentral ng Pilipinas year mark  New Design Series (1985-2017) Obverse Reverse 5 Sentimo, "Republika ng Pilipinas", year Logo of the Bangko Sentral ng Pilipinas mark  New Design Series (1985-2017) Obverse Reverse 1 Sentimo, "Republika ng Pilipinas", year Logo of the Bangko Sentral ng Pilipinas mark New Generation Currency Series (2010-present) In 2009, the Bangko Sentral ng Pilipinas announced that it launched a massive redesign for current banknotes and coins to further enhance security features and improve durability. \. The new banknote design features famous Filipinos and iconic natural wonders. Philippine national symbols will also be depicted on coins. To provide a smooth transition from the New Design Series to New Generation Currency (NGC) series, BSP purposely retained some NDS features, such as, the size, predominant colors and the featured personalities in the NGC, except for the portrait of President Corazon Aquino which is an added portrait on the 500-piso note. The BSP started releasing the initial batch of new banknotes on December 16, 2010. The BSP launched in 2020 the enhanced NGC banknotes that are more responsive to the needs of the elderly and the visually impaired, and feature the latest anti-counterfeiting technology. The NGC and enhanced NGC banknotes are legal tender and may be used as payment for goods and services.  New Generation Currency Series (2010-present) Obverse José Abad Santos, Vicente Lim, Josefa Llanes Escoda Reverse Tubbataha Reefs Natural Park in Sulu Sea; Pinctada maxima, South Sea Pearl; Mindanao design for Tinalak (Ikat-dyed abaca) Color blue Description The portrait of Abad Santos, Lim and Escoda were revised, a scene from the Centennial celebration of Philippine independence was added on the lower left. The reverse now features the Tubbataha Reefs Natural Park and the South Sea Pearl.  New Generation Currency Series (2010-present) Obverse Corazon C. Aquino, Benigno S. Aquino, Jr., EDSA People Power I, Benigno Aquino monument in Makati City Reverse Subterranean Underground River in Puerto Princesa, Palawan; Tanygnathus lucionensis, Blue-Naped Parrot; Southern Philippines cloth design Color Yellow Description The portrait of Benigno Aquino, Jr. was redesigned and a portrait of his wife, former president Corazon Aquino, was added, a scene from the EDSA Revolution was added on the lower left of the obverse and the Ninoy Aquino Monument was added in the lower middle. The reverse now features the Puerto Princesa Subterranean River National Park and the Blue-Naped Parrot.  New Generation Currency Series (2010-present) Obverse Diosdado P. Macapagal, EDSA People Power 2001, Aguinaldo Shrine in Kawit, Cavite, Barasoain Church in Malolos, Bulacan Reverse Chocolate Hills in Bohol; Tarsius syrichta, Philippine Tarsier; Visayas weave design Color Green Description The portrait of Diosdado Macapagal was revised, the Arroyo oathtaking was moved from the reverse to the lower left of the obverse with the Aguinaldo Shrine at the background and the Barasoain Church was added on the lower middle. The reverse now features the Chocolate Hills and the Philippine Tarsier.  New Generation Currency Series (2010-present) Obverse Manuel A. Roxas, Old BSP building in Intramuros, Manila, Inauguration of the Third Philippine Republic Reverse Mayon Volcano in Albay; Butanding, Rhincodon typus, whale shark; Bicol textile design Color Violet Description The portrait of Manuel Roxas was redesigned, a picture of the old Central Bank building and the inauguration of the Republic of the Philippines was added on the lower left corner and bottom center of the bill respectively. The reverse now features the Mayon Volcano and the whale shark.  New Generation Currency Series (2010-present) Obverse Sergio Osmeña, First Philippine Assembly, Leyte Landing Reverse Taal Lake in Batangas; Catanx ignobilis, Maliputo (Giant trevally); Batangas embroidery design Color Red Description The portrait of Sergio Osmeña was revised, a picture of the first Philippine Assembly and Osmeña and General Douglas MacArthur's landing in Leyte was added on the lower left corner and bottom center of the bill respectively. The reverse now features the Taal Lake and the giant trevally.  New Generation Currency Series (2010-present) Obverse Sergio Osmeña, First Philippine Assembly, Leyte Landing Reverse Taal Lake in Batangas; Catanx ignobilis, Maliputo (Giant trevally); Batangas embroidery design Color Red Description The portrait of Sergio Osmeña was revised, a picture of the first Philippine Assembly and Osmeña and General Douglas MacArthur's landing in Leyte was added on the lower left corner and bottom center of the bill respectively. The reverse now features the Taal Lake and the giant trevally. New Generation Currency Series (2010-present) 1000-PISO POLYMER BANKNOTE OBVERSE The obverse side features two of the country’s national symbols: the Philippine Eagle (Pithecophaga jefferyi) as its focal point, and the Sampaguita (Jasminum sambac). The Philippine Eagle exemplifies the Filipino’s uniqueness, strength, power, love for freedom, as well as a sharp vision for the country’s future. Meanwhile, the Sampaguita symbolizes purity, simplicity, humility, and strength. 1000-PISO POLYMER BANKNOTE OBVERSE The reverse side retains images of the Tubbataha Reefs Natural Park, declared as a UNESCO World Heritage Site, and the South Sea Pearl.