» Posts tagged: ‘community currencies


Paula Sánchez de la Blanca

The dynamic scene of community currencies in Spain

Encuentromsalcala

Learning about the civic innovation potential of alternative currencies during the 5th Meeting of Community Currencies

In the context of the ‘2016 Social Spring’, Alcalá de Henares, hometown of Miguel de Cervantes, hosted the 5th Meeting of Community Currencies (or ‘monedas sociales’) in Spain. Members of more than 20 community currencies (CCs) attended the meeting during the weekend of the 20th -22nd May 2016 and a series of thematic lectures during the previous week. A few academics including Georgina Gómez and myself, on behalf of ISS CIRI team, were also present at this meeting interested in the civic innovation dynamics of this gathering.

The major themes during the lectures were software applications for CCs, local currencies in public policy and the social transformation potential of solidarity-based community projects. There was also time for self-organized workshops among participants who were members of a community currency, an open space to exchange experiences and a general assembly to reach agreements for upcoming coordination projects. Indeed, the main objective of this meeting was to bring together the different community currencies throughout Spain, enhancing interaction and exchange of challenges and solutions.

The interactive nature of this meeting is a reflection of the dynamic scenario of Spanish community currencies. Community currencies have extraordinarily spread throughout Spain during last decade. According to Julio Gisbert’s CCs database, more than 300 initiatives are counted nowadays.

Contextualizing CCs in Spain

Over the past hundred years, Spain has had a rich history of local currency innovation. During the civil war (1936-1939), Francoist forces refused to accept the official money split Spain in two opposing currency zones. In parallel, communities with a tradition of anarchist ideas in the South and East of the country started to issue their own local forms of money (Hugues, 2015). As historian Wilko von Prittwitz put it, Spain became in that period a variety of currency experiments.

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Historical community currency in Spain

According to Hugues, a second wave of currency innovation was in the late 1990s, when Spanish local governments engaged in ‘municipal timebanking’ creating or offering assistance to groups willing to use time-banking to support people’s needs and solidarity networks in the city areas.

 

 

Since 2009, Spain is living a third wave of experimentation in alternative economic practices. This recent rise of community currencies in Spain is framed in the context of economic crisis where CCs are responding to social needs created or accentuated by the crisis.

As evidenced in the Alcala de Henares meeting, there is also an important role for what Hugues calls ‘CC pioneers’, like Julio Gisbert or Enric Durant. Julio Gisbert is author of the book ‘Vivir sin empleo’ and a blog with the same name. He is also the president of the Association for the development of timebanks in Spain. Nicknamed ‘The Bank Robin Hood’, Durant is the co-founder of the crypto currency Fair coin and its cooperative Fair Coop, and he has been actively engaged in the Catalonian integral cooperatives. Besides, Hugues sees a growing influence of heterogeneous social movements such as the de-growth activists and the 15M Movement.

Although CCs in Spain differ substantially in their principles and goals, there is a common understanding of the systemic problems of a growth-based economy and the need of alternative economic practices experimentation, recognizing that money is socially-constructed. The 15M movement emerged in 2011 out of demonstrations where hundreds of thousands of ‘indignant’ citizens occupy city squares across the country (see our related post here). Many of the self-managed local groups remained committed to mutuality and locality and they join or create a community currency. For example, in the Canary Islands Demos, a self-organized CC with a basic income revenue scheme emerged from the 15M Assembly of La Isleta. In her research on Puma LETS in Seville, Medina (2015: 26) concludes that ‘contentious claims as well as the plans and actions of the 15-M social movement, motivated degrowth activists to inaugurate a LETS within the Pumarejo neighbourhood, transforming potential for mobilisation into action.’

Diversity and increasing interaction

Julio Gisbert’s database currently maps out more than 300 CCs throughout Spain, with Catalonia, Andalousie and Madrid being the most active regions.

GisbertMap

Julio Gisbert’s map of community currencies

He differentiates time-banks, bartering schemes and social currencies/markets. Among them there is a wide variety of principles, designs and actors involved. In terms of community currencies, they can be euro-backed (such as the Boniato en Madrid and the Ekhi in Bilbao). However, the most widespread type is mutual-credit schemes where a virtual currency is created through the exchange of goods/services of its products. In fact, the vast majority of participants in Alcala de Henares were part of a mutual-credit currency. Examples include the Puma in Seville, the Turuta in Vilanova i la Geltrú, the ekos in the Castellón, the común in Malaga, the Demos in the Canary Islands, the pita in Almeria and the Osel in Murcia.

In this diverse mosaic of alternative economic practices in Spain, there is not a common project. However, many CCs are increasingly interacting with each other. The Alcala de Henares meeting has been the fifth nation-wide effort to exchange experiences and meet strategic stakeholders (such as local governments and software design companies). There is a growing interest in learning from each other. For instance, out of the assembly of this V meeting, an open document was created to exchange practical challenges and solutions among CCs. Also, a workgroup was created to organize a journey-documentary visiting all CCs initiatives in Spain trying to only use social money.

Concluding, community currencies in Spain are opening new learning spaces from where many people are better coping with the social needs created or accentuated by the economic crisis. However, is their civic innovation potential limited to the context of crisis? Looking at the current scenario of Spanish CCs, it seems many of them have already created new ways of understanding and doing a sustainable social economy.

 

 

 

This is the first blog of a CIRI roundtable on Complementary Currency Systems and South-North knowledge transfer. The event got together 25 academics and practitioners from several generations and European countries.

by Georgina M. Gómez

The meeting was an invitation to re-think the differences between the CCS in the developed and developing countries, and to explore learning from each other. While in Europe and North America the schemes with complementary currencies focus on promoting a sustainable economy and enhancing social cohesion, in Latin America they are mainly seen as tools for income generation and the improvement of welfare. The differences in terms of motivations are clear in the economic daily practices in the North and South, and have made the transfer of knowledge among practitioners quite slow. Attempts to reproduce in the North the methodologies of the South have been extremely rare, possibly because of the conception that the contexts are too different for those experiences to be useful or perhaps because they are not sufficiently well-known. In contrast with the geographical compartmentalization of CCS experiences, researchers in the academic field have studied CCS in the North and the South with the same theoretical tools and frameworks, which are almost invariably designed in the North, as if context need not affect the research tools and instruments. We started the meeting with two presentations of the largest scale CCS in the South.

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Voices from the South

The first speaker was William Ruddick, from the Kenyan organization GrassrootsEconomics.org. Ruddick presented the case of which he was one of the main organisers, Bangla-Pesa, the first community currency implemented in a slum in Mombasa in 2012. A legal battle occurred then between the organisers, who were accused of currency forgery, and the government, until the later understood that the notes were similar to business vouchers that circulated within a closed network. The Bangla-Pesa has been used without problems since the courts’ allowed it in 2013 and the scheme has been replicated in two informal settlements in Nairobi in 2014. This year the Bangla-Pesa model has been implemented and expanded upon by FlowAfrica.org in South Africa, in the area of Bergrivier.

The Bangla-Pesa, is based on building a closed currency circuit of approximately 100 users to lock in production, circulation and consumption in the territory. Potential members are introduced to the scheme by four existing members who vouch for the new one. The organisers then issue the equivalent in complementary currency of 400 Kenyan Shillings or 500 Rand in the South African programmes, of which roughly half are given to the new entrant. The rest is a contribution fee of the new member to a community fund and will be used to pay community service work, like garbage collection done by youth. The daily value traded is about 10,000 Kenyan Shillings (1000 Rand in South Africa) and engages daily about 100 businesses. That means that Bangla-Pesa enables an extra 100 Kenyan Shillings worth traded daily per businesses.

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The second speaker was Carlos de Freitas of the Brazilian Palmas Institute. Similarly to the Mombasa case, the financial activities of Palmas started in an undeveloped and poor informal settlement called Conjunto Palmeiras in the North of Fortaleza, Brazil. The aim was the same: to retain as much value as possible in the neighbourhood, so that local needs could be satisfied with local production, and to support local entrepreneurship. However, in the case of community Banco Palmas the physical currency was created in 2002 as a spin-off of a pre-existent micro-credit programme and not primarily as a means of payment. Banco Palmas bank provides small loans in palmas (not in the official currency) that allow the community enterprises and individual firms to start their production, which they would never be able to obtain from a regular bank. Much of their start-up capital is spent locally in wages, inputs, and space rent, so it generates local economic effects.

Banco Palmas is not a pure credit system as defined by Wicksell (1898) in ‘Interests and Prices’, because every palma in circulation has a back-up in official currency. Credits offered do not require collateral, because neighbors vouch for the person receiving it. Producers may obtain interest-free small loans in Palmas currency or regular money loans with a small interest rate. The approach of Banco Palmas articulates several projects to tackle social inequalities, participatory education, community organization and a general territorial development approach. In 2011 there were around 270 businesses using the Palmas currency and 46,000 Palmas in circulation (around 20,000 Euro at that time).  The scheme has created 1300 jobs but is presently in decline due to the availability of other welfare protection policies in Brazil.blog georgina foto 3

Conclusion

To wrap up, around 2000 experts on CCS were avidly looking at the case of the Argentine Redes de Trueque for an example of scaling-up, around 2007 they were looking at Brazil and the Community Banks, of which Palmas was the first and most prominent. The focus is now shifting to Africa with the examples of Kenya and South Africa, in which a number of the problems experienced in the other two are working to be corrected.


International Institute of Social Studies

CIRI aims to scale up and identify synergies between existing research at ISS on civic agency and change agents, as drivers of societal change and development. This blog is a forum on which to share and discuss themes and issues which fall within the broad framework of the programme.

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