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The gold franc (currency code: XFO) was the unit of account for the
Bank for International Settlements The Bank for International Settlements (BIS) is an international financial institution owned by central banks that "fosters international monetary and financial cooperation and serves as a bank for central banks". The BIS carries out its work th ...
from 1930 until April 1, 2003. It was replaced with the
special drawing right Special drawing rights (SDRs, code ) are supplementary foreign exchange reserve assets defined and maintained by the International Monetary Fund (IMF). SDRs are units of account for the IMF, and not a currency ''per se''. They represent a claim ...
. It was originally based on the Franc Germinal, and remained at the value the franc was pegged (0.290322 g fine gold) after the countries of the
Latin Monetary Union The Latin Monetary Union (LMU) was a 19th-century system that unified several European currencies into a single currency that could be used in all member states when most national currencies were still made out of gold and silver. It was establi ...
came off the gold standard.


Use in New Hebrides

The gold franc was used in the Anglo-French Condominium of the
New Hebrides New Hebrides, officially the New Hebrides Condominium (french: link=no, Condominium des Nouvelles-Hébrides, "Condominium of the New Hebrides") and named after the Hebrides Scottish archipelago, was the colonial name for the island group ...
(now
Vanuatu Vanuatu ( or ; ), officially the Republic of Vanuatu (french: link=no, République de Vanuatu; bi, Ripablik blong Vanuatu), is an island country located in the South Pacific Ocean. The archipelago, which is of volcanic origin, is east of no ...
) as the currency in which the joint administration's postal service denominated its stamps, a natural choice as the Universal Postal Union Treaty (beginning in 1874 when the first treaty was agreed and reaffirmed at subsequent Congresses until at least that of 1939—see the various "Actes du Congress...") denominated the agreed international postal rates in gold franc and gold centime leaving each member country and its dependencies to translate the amounts into their own currencies. This added to the already confused situation in which the Australian dollar and the
New Hebrides franc The franc was the currency of the Anglo-French Condominium of the Pacific island group of the New Hebrides (which became Vanuatu in 1980). It circulated alongside British and later Australian currency. The New Hebrides franc was nominally divide ...
were used in normal trade (and in which even the
pound sterling Sterling (abbreviation: stg; Other spelling styles, such as STG and Stg, are also seen. ISO code: GBP) is the currency of the United Kingdom and nine of its associated territories. The pound ( sign: £) is the main unit of sterling, and ...
turned up the columns of earlier joint administration budgetary documents).


Swiss Gold Franc Initiative

On March 9, 2011, a parliamentary
initiative In political science, an initiative (also known as a popular initiative or citizens' initiative) is a means by which a petition signed by a certain number of registered voters can force a government to choose either to enact a law or hold a p ...
was introduced in the
National Council of Switzerland The National Council (german: Nationalrat; french: Conseil national; it, Consiglio nazionale; rm, Cussegl naziunal) is the lower house of the Federal Assembly of Switzerland, the upper house being the Council of States. With 200 seats, th ...
to institute a gold franc as additional currency for
Switzerland ). Swiss law does not designate a ''capital'' as such, but the federal parliament and government are installed in Bern, while other federal institutions, such as the federal courts, are in other cities (Bellinzona, Lausanne, Luzern, Neuchâtel ...
: This initiative was examined by th
Committee for Economic Affairs and Taxation
which rejected it at the June meeting. This gold franc would have been defined as 0.1
gram The gram (originally gramme; SI unit symbol g) is a unit of mass in the International System of Units (SI) equal to one one thousandth of a kilogram. Originally defined as of 1795 as "the absolute weight of a volume of pure water equal to th ...
of fine
gold Gold is a chemical element with the Symbol (chemistry), symbol Au (from la, aurum) and atomic number 79. This makes it one of the higher atomic number elements that occur naturally. It is a Brightness, bright, slightly orange-yellow, dense, s ...
. The initiative would not have removed, replaced or pegged the existing Swiss franc, therefore both the gold franc and the Swiss franc would have coexisted side-by-side. Due to the fixed metallic content of the gold franc, its exchange rate with the Swiss franc would have gone up and down according to market supply and demand, like any other free-
floating currency In macroeconomics and economic policy, a floating exchange rate (also known as a fluctuating or flexible exchange rate) is a type of exchange rate regime in which a currency's value is allowed to fluctuate in response to foreign exchange marke ...
. The gold franc was intended to become a
safe-haven currency In macroeconomics, hard currency, safe-haven currency, or strong currency is any globally traded currency that serves as a reliable and stable store of value. Factors contributing to a currency's ''hard'' status might include the stability and r ...
, to divert international capital flows in times of
financial crises A financial crisis is any of a broad variety of situations in which some financial assets suddenly lose a large part of their nominal value. In the 19th and early 20th centuries, many financial crises were associated with banking panics, and man ...
away from the Swiss franc.Bilan
Parliamentary initiative to launch the "gold franc"
(in French).
The gold franc would have been completely independent from the gold reserves of the
Swiss National Bank The Swiss National Bank (SNB; german: Schweizerische Nationalbank; french: Banque nationale suisse; it, Banca nazionale svizzera; rm, Banca naziunala svizra) is the central bank of Switzerland, responsible for the nation's monetary policy an ...
. It would have been minted only by Swiss commercial banks, under the supervision of the Swiss Confederation. The backers of the gold franc hoped that its institution would have made it easier for small savers to invest in gold by reducing the minimum investment and trading unit.


References


External links


Gold Franc Association
- coordinating the efforts to introduce the gold franc as additional currency in Switzerland. {{DEFAULTSORT:Gold Franc Gold coins Proposed currencies