10 Dollars – Jamaica

By 1975, Jamaica's currency situation was deeply strained, reflecting the broader economic and political crisis of the Michael Manley-led People's National Party (PNP) government. The country was grappling with the dual shocks of the 1973 oil price crisis and a sharp decline in global demand for bauxite, its key export. In response, the government had levied a controversial production levy on bauxite companies in 1974, which, while increasing state revenue, also triggered capital flight and a collapse in foreign investment. This eroded confidence in the Jamaican dollar, which was pegged to the US dollar, and led to severe balance of payments difficulties and dwindling foreign exchange reserves.

The government's policy response, framed within its democratic socialist agenda, included the imposition of strict exchange controls to conserve scarce foreign currency. These controls created a complex system of licensing for imports and limited access to foreign exchange for both businesses and individuals, leading to widespread shortages of essential goods. A thriving black market for US dollars emerged, where the Jamaican dollar traded at a significant discount compared to the official fixed rate. This parallel market became a critical, though illegal, avenue for obtaining foreign exchange, further undermining the official financial system and contributing to inflation.

Ultimately, the pressures proved unsustainable. In 1977, the government was forced to formally devalue the Jamaican dollar and seek assistance from the International Monetary Fund (IMF), marking a pivotal shift in economic policy. However, the conditions of 1975—characterized by a fixed but overvalued currency, severe foreign exchange shortages, rampant black-market activity, and declining investor confidence—set the stage for this eventual economic reckoning and defined a period of profound hardship for the Jamaican economy.