Whites-Only Town In South Africa Creates Its Own Digital Currency
By Ryan Velez
Apartheid may be a thing of the past, but the legacies of such things rarely die easily, as can be seen in the infamous “Whites-only” town of Orania in northern Cape Town, South Africa. Face2Face Africa reports that in another step to try and separate itself from the world and people around it, the 1,300 population town is creating its own digital currency designed exclusively for inside the town.
This isn’t actually a massive leap for Orania, as it already uses a local currency called the “ora,” printed by the town’s chamber of commerce and distributed through the central bank. The digital version will be accessible via mobile app, and is expected to replace ora notes that are technically vouchers pegged to the South African rand and expire after three years. This digital currency will have no expiration date and it will allow people to trade it with each other and local businesses via smartphones. Those coordinating the project say that this will allow more efficiency in everyday business transactions while saving costs from printing money.
“It is basically electronic cash that will be moved from wallet to wallet with every transaction without the commercial banks standing in the middle,” says Peter Krige, a coordinator of the project.
“In this way, friction and cost is removed from the transaction. Both consumers and retailers will save between three and five percent per transaction.” Working with the town is award-winning economist Dawie Roodt. Despite the controversy around Orania and the project, he feels that the learning opportunity is worth potential backlash.
“Where else is there an opportunity for an economist to do an experiment like this? This is like a petri dish…I want to see what environment is created by digital currency,” Roodt says, adding that if the project is successful, he will introduce it to other communities within South Africa.
However, the further isolation is of little comfort to critics of Orania from throughout South Africa and beyond, who say that their desire to remove themselves is an attempt to recreate pre-democratic South Africa within a territory, a rejection of the Rainbow Nation concept. Residents argue that this decision is twofold: to preserve their linguistic and cultural heritage while protecting themselves from South Africa’s high crime rate. The bulk of Orania residents are Afrikaans, a South African language derived from the form of Dutch brought to the country by Protestant settlers in the 17th century.