5 Pounds – Gibraltar

In 2008, Gibraltar's currency situation was defined by its unique political status and its close economic integration with the United Kingdom. As a British Overseas Territory, its official currency was (and remains) the Gibraltar pound (GIP), issued by the Government of Gibraltar under the terms of the 1934 Currency Notes Act. This currency was pegged at par with the British pound sterling (GBP), which also circulated freely and was universally accepted within the territory. This peg provided stability and ensured seamless financial transactions with the UK, Gibraltar's dominant trading partner and source of tourism.

The global financial crisis of 2008 presented a significant stress test for this arrangement. While Gibraltar's banking sector, heavily focused on private banking and offshore services, faced scrutiny and pressure, the currency peg itself held firm. The territory's fiscal position was relatively strong, and its commitment to the sterling peg was unwavering, seen as essential for economic confidence. However, the crisis underscored Gibraltar's exposure to international financial turbulence and prompted later reviews of financial regulation, though not its fundamental currency policy.

Furthermore, a practical currency reality in 2008 was the limited international convertibility of the Gibraltar pound. While interchangeable with sterling locally, GIP banknotes were often not accepted by banks or businesses in the UK or elsewhere, requiring exchange for sterling notes. This contrasted with the situation for Scottish or Northern Irish banknotes, which, while also issued locally, were more widely accepted. Thus, the Gibraltar pound functioned effectively as a domestic symbol of sovereignty but operated within a de facto sterling zone, a system that provided crucial stability during the turbulent economic climate of 2008.