How Apartheid Hurt the Krugerrand

By Tyler Rossi for CoinWeek …..

A system of racial segregation in South Africa, Apartheid was first instituted in 1948 by the minority White Afrikaans dominated government. When translated from the Afrikaans, apartheid means “separateness” – though the word itself does not denote the extent of the oppression of the Black majority and other non-white ethnic groups.

By the early 1970s, many international actors, both governmental and non-governmental, began protesting this oppressive regime. These protests culminated in 1986 when the United States Congress overrode President Ronald Reagan’s veto to pass the Comprehensive Anti-Apartheid Act, which imposed severe economic and political sanctions on South Africa until the regime ended Apartheid. This act was partially repealed in July 1991 and later fully repealed in 1993 when the South African government began officially undoing Apartheid.

Nearly a decade before the international backlash hit its peak, the South African regime debuted the Krugerrand. While a true bullion coin, the Krugerrand is still legal tender, denominated at a floating rate equal to the value of an ounce of pure gold. Used as an economic vehicle to monetize the nation’s vast gold reserves, the coin was an immediate hit.

It didn’t take long for the Krugerrand to become economically vital to the regime. By 1979, it was by all accounts the most popular gold bullion coin in the world, and five years later it accounted for 90% of the international gold coin market. Massive quantities of gold being were exported to the United States and Europe. For example, in 1976 and ’77, a combined 7.7 million one-ounce Krugerrands were sold globally for a total of approximately $1 billion, of which 50% went to the U.S. Furthermore, the South African Government earned an estimated $1 billion in U.S.-based Krugerrand sales between 1981 and 1984.

To prompt additional sales, the South African Chamber of Mines engaged Doyle, Dane & Bernbach, a New York advertising agency, to launch a promotional campaign in 1975. First released in Los Angeles, Houston, and Philadelphia, this campaign saw a sales increase of 40%, with the 1-800 phone line receiving 6,000 calls in the first week (Irish, 1). Finally expanding to 25 cities, this three-month campaign was incredibly successful. These coins became so entrenched in the American psyche that a football coach at Indiana University even ran a series of Krugerrand ads to pay for a Sunday morning religious event (Nesbit, 7).

However, the massive profits were effectively blood money. The people working in the mines to create these immense profits that supported the Apartheid regime were the very people suffering from its oppression: Black South Africans. This was the case going all the way back to the second half of the 1800s when gold and diamonds were first discovered in great quantities. As incredibly capital intensive (i.e. expensive) ventures, these mines were all owned by the White minority. Not only were all the profits kept from the local population, but those who refused to enter the mines were also charged an individual poll tax and a communal hut tax for each house in the targeted communities.

By the mid-1970s, conditions were entirely unsafe and pay was terrible. Not only could Black miners expect to earn an average of 1/15 their White counterparts, but three people died per shift on average. In 1978, it was reported that the average monthly salary of a Black miner was R119 (about $137) and R840 (about $966) for their White counterpart. In the four years from 1972 to 1975, a total of 2,993 accidental deaths and 110,169 serious injuries occurred in the mines (Rothmyer & Pitterman, 1-2). Additionally, the miners worked on 18-month-long contracts with no real breaks while being forced to live in barracks away from their families. Under the threat of violence, arrest, and even death, no trade unions or strikes were allowed.

So, what happened to upend this system? How did Apartheid, which benefited so greatly from the Krugerrand, end up hurting the coin?

The Krugerrand became recognized as a visible representation of the regime with a “deep-rooted sociopolitical and symbolic” history (Kirby & Lachowskyj). As a result, this symbol, the Krugerrand, was an easy target for local activists in the U.. It was much simpler to educate people on the exploitative and oppressive nature of the South African regime through the Krugerrand than through some abstract concept. For example, a number of groups organized anti-Krugerrand protests during March 1977 in commemoration of the 1960 famous South African Sharpeville Massacre. Efforts also targeted local coin dealers who sold the coins by picketing outside of coin stores. In a more visible move, the United Methodist Church ran an anti-Krugerrand ad in the Detroit Free Press newspaper in December 1976.

Through this combination of picketing and lobbying, activists managed to convince the city councils of Denver, San Antonio, Dayton, Boston, Portland, Milwaukee, and Chicago to all vote and pass resolutions urging citizens not to buy Krugerrands. All of this negative messaging encouraged Merrill Lynch to stop all sales in January 1978. While their PR department stated this was in response to a lack of demand, sales had actually increased by over 100% between 1976 and 1978 (Rothmyer & Pitterman, 4).

How Apartheid Hurt the Krugerrand

Activists also targeted large nation-wide banks that sold Krugerrands and loaned money to the South African Government, such as Chase and Bank of America. This prompted them to suspend such activities. For example, when one activist organization threatened to withdraw one million dollars from Northwestern Bank in Minneapolis, the bank abruptly stopped their Krugerrand sales and South African loans. Most notably, however, was when targeted sit-ins and protests forced the nation’s largest dealer of Krugerrands, Deak-Perera, to halt sales in 1985. (Larson, 188).

While this social pressure did force these authorized dealers to halt sales of Krugerrands, it had an even larger effect by influencing President Reagan to formally ban the importation of all Krugerrands into the States. As a result, the mintage figures (and sales) of the Krugerrand plummeted from over two million in 1984 to just over 21,000 in 1986. In its place, the Canadian Maple Leaf, the Chinese Panda, the American Eagle, and the Austrian Philharmonic all moved in to fill the global demand for gold bullion coins. Even after the six year import ban was lifted in 1990, the Krugerrand was unable to reclaim its original market dominance. For example, in 1999 China minted 32,450 Pandas; Canada 627,097 Maple Leaves; Austria 230,700 Philharmonics; and the U.S. struck 1,505,026 Eagles. Meanwhile, South Africa issued only 19,838 1oz Krugerrands, equaling a less-than-1% market share. A long fall from 1980 when the Krugerrand commanded 90% of the global market.

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Irish, 1976 –

Kirby & Lachowskyj, 2018 –

Larson, 2019 –

Rothmeyer & Pitterman, 1977 –

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About the Author

Tyler Rossi is currently a graduate student at Brandeis University’s Heller School of Social Policy and Management and studies Sustainable International Development and Conflict Resolution. Before graduating from American University in Washington D.C., he worked for Save the Children creating and running international development projects. Recently, Tyler returned to the US from living abroad in the Republic of North Macedonia, where he served as a Peace Corps volunteer for three years. Tyler is an avid numismatist and for over a decade has cultivated a deep interest in pre-modern and ancient coinage from around the world. He is a member of the American Numismatic Association (ANA).


  1. This article essentially has nothing to do with the KR. It doesn’t belong on a coin site.

    No, I didn’t approve of the system and yes, I did live in the country during this era.


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