Friday, 29 January 2016

A modest proposal regarding the Złoty

The world's major currencies - the dollar, the euro, the pound, the yen/yuan, have specific symbols known the world over, present on the keyboards of our computers and smartphones. That's $, €, £, ¥. Since 2010, the Indian rupee (₹) and since 2012, the Turkish lira (₺) have joined the exclusive club of currencies that are assigned their own symbol.

Every other currency - the Swiss franc (CHF), Russian rouble (RUB), Australian dollar (AUD) - have prosaic three-letter designations used by currency dealers and bureaux de change the world over. And in this less-distinguished group of currencies, we find Poland's złoty (PLN). [Note: the 'N' in PLN means 'new' and was introduced when Poland denominated its currency by shedding four zeros on 1 January 1995. PLN thus replaced PLZ.]

Anyway - given that Poland is in no great hurry to ever join the euro - a ramshackle collection of currencies designed by the Germans to keep their exports competitive - what about a symbol for the złoty? The eurozone's troubles are endless and structural, and to sort them out there has to be banking union and tax union, and handing over sovereignty on matters like that to the European Central Bank will not play well in Poland whatever the complexion of its government.

OK, so Poland did sign up in its EU Accession Treaty to join the euro one day - though matters like 'when' and 'at what rate' were left up in the air.

The euro works like this: putting the drachma, Italian lira, peseta and whatever it was the Portuguese had into the same currency as the German deutschmark has had the following effect - making the euro incredibly competitive for pricing German exports. Look at the graph below:

Over the past five years, the euro has become 20% weaker compared to the dollar. Hey America! There's never been a better time to buy a BMW, Merc or Audi! Now, imagine the above graph as deutschmark to dollar. Unshackled from the currencies of the Mediterranean, the deutschmark could have been appreciating like the Swiss franc, a safe-haven currency backed by strict fiscal and monetary discipline. German exports would have become uncompetitive. So for the cost of bailing out the lax PIIGS, Germany has retained a strong manufacturing sector through the global crisis along with low, low unemployment.

[One reason why today's US GDP growth figures for Q4 2015 were so weak was because the strong dollar has hit American exports. America's loss, Germany's gain.]

And where would Poland - inextricably linked to the German supply chain - fit into the scheme of things, were it to have joined the euro along with Slovakia, Slovenia and the Baltics?

Trapped, in a word. Poland was the Green Island in 2009 because the złoty depreciated by nearly 40% against the euro between August 2008 and February 2009. This gave Poland's manufacturers (30% of Poland's GDP) a chance to get competitive. Poland never suffered the crippling unemployment faced by Spain or Greece.

So - if Poland wants to demonstrate a healthy dose of eurozone scepticism, and with it a disdain for the notion of an ever-closer union led by an inner core of EU members - I suggest it adopt a symbol for its currency. This needs further debate, as I'll explain..

 Left: a capital 'Z' with two horizontal lines through it. A variant could have but one horizontal line through it, but that (and here's the historical sensitivity) was the insignia of the 4th SS Polizei Panzergrenadier Division. Although this particular bunch of evil thugs tasked with fighting partisans behind Nazi lines never fought on Polish soil, this symbol could be misread by other nations. So - handle with care. But with two lines - it looks neat and strong, and alluding to the euro's symbol, €.

The alternative (left) is a vertical line through the 'Z', referencing the dollar (Latin American pesos tend to have two vertical lines through the 'S'). This variant would display more transatlantic yearnings, and a sign of difference from the horizontally-crossed euro.

Alternatively, and here my typographical and Photoshop skills are not strong enough, a single (or indeed even double) horizontal wavy line through the 'Z', alluding to the wavy line in the handwritten lower-case letter 'ł'. Very Polish, and unique among currency symbols.

Dear readers - what do you think? [Readers answered - their suggestions are here.]

Should the złoty (nominally at least) be aiming to converge with the euro at some undefined moment in the future? Should the złoty stay out of the eurozone for ever (much as the pound sterling seems likely to do)? And if so, should the złoty adopt a symbol for itself, a matter of national pride? And if so - what should that symbol look like? Comments please!

Click here to see readers' suggestions!

This time last year:
Warsaw Spire getting higher and higher

This time two years ago:
Plac Zbawiciela, lunchtime, winter

This time three years ago:
Is this winter's end?

This time four years ago:
The other Jeziorki station

This time six years ago:
Launching the General's book

This time seven years ago:
A pavement for ul. Karczunkowska?
(For a while there it looked like the city authorities would provide us locals with a pavement so that we could safely walk to the station with clean footwear. Seven years on - not a bit of it. Maybe a Marszałek of a Warsaw Agglomeration voivodship could see to it.)

This time eight years ago:
Taking off over Okęcie


DC said...

Add an ogonek as a nod to Jarosław's kitty.

Ross Humphries said...

Mike can you email me please. I am unable to paste what I like on the Blogger.
I do not like two bars or any bars thru the Z. The l should be beside the Z, not over it. Zl in Calibri, capital Z with small l then a styled paint line wave thru both. The small l in Calibri is flat bar. Email is

Anonymous said...

Interesting, but wouldn't simple and traditional "zł" serve us well enough?

Michael Dembinski said...

@ Anonymous

It would, but that would be less fun :-)