“A SUPERIOR PRACTICAL MAN”: SIR HENRY STRAKOSCH, THE GOLD STANDARD AND MONETARY POLICY DEBATES IN SOUTH AFRICA, 1920–23

Abstract

ABSTRACT Although enjoying some de jure independence, South Africa in the year of the SARB's establishment, 1921, was by no means a de facto independent country, being tied in important ways to Britain. However, by the end of the First World War, it was clear that British imperial power was on the decline almost everywhere. As the British real economy declined, the power elite in Britain had begun to focus its attention on maintaining London as the centre of the world's financial system, painfully aware that the financial sector was the last sector of the economy in which Britain still maintained some level of relative dominance. It is in this global context that a naturalized British expert, Mr (later Sir) Henry Strakosch, was appointed by the ‘pro-British’ Smuts government to advise on various monetary issues in South Africa, including the establishment of the South African Reserve Bank. Later, upon its establishment another Briton, Clegg, was appointed its first Governor. In contrast the Pact government headed by Smuts rival, Barry Hertzog, later appointed an American and a Dutchman to lead their commission of enquiry into monetary questions. This research review seeks to throw some light on the first of these ‘foreign’ experts, Henry Strakosch. So who was Strakosch and why did he have such an enormous impact on South African monetary policy?