The Chiemgauer

by Deirdre Kent (author of "Healthy Money Healthy Planet")

On her way home from New Zealand in early 2002, Margrit Kennedy interviewed one of the founders of an Australian voucher scheme and went away to think about it for a week. She was about to retire from her position as professor of Architecture in Hamburg and planned to spend the next five years of her life in practical work to establish complementary currencies with a circulation incentive. Her book Interest and Inflation Free Money had not yet produced any experiments with demurrage and she was frustrated. At that stage she hoped she would return to New Zealand to work on her dream. But on arrival home in Germany she discovered the real opportunity was at her very own doorstep.

Germany's economy had been in decline and regional managers were looking for a way to stimulate and protect local economies. The euro could not deal with it. Margrit thought of the Australian voucher scheme and after much discussion, modified it and recommended it. The idea fell on receptive ears. One of the first regional currencies to get underway was organised by six young women, students at a Steiner School in the mountain town of Prien in the Chiemgauer district of Bavaria. Their economics teacher Christian Galleri had been a friend of Bernard Lietaer, Margrit's close friend in the movement.

The girls launched their scheme in January 2003 after two months of preparation. Chiemgauers come on denominations of one, two, five, ten and twenty and are colourful in orange, purple and green. Each bill has a hologram, a serial number and two signatures. Printing standards are high and forgery is difficult. There is also a club card, identifying members of the association they had to form to avoid prosecution from financial authorities, Each member must sign rules they agree to obey and membership is free. Notes are known as coupons or credit notes.



Retailers accepting chiemgauer can only redeem them for 95% of their value, as 2% goes to the students for administration of the programme and 3% goes to a local charity of the merchant's choice.

But it is also an aging currency. Notes are only valid for three months and come with an expiry date. To validate them holders must pay - every three months - two percent of the face value as a circulation fee to prevent hoarding and place a sticker on the note as proof. That gives them an incentive to pass them on quickly.

Thus the scheme is good for local economic development and prevents money from going out to the big cities where it can earn the greatest return. It stays in the district instead. A certain amount of national currency is thus taken out of circulation and replaced with a currency only valid in the region.

By October 2003 they had 50,000 chiemgauer in circulation. Bundles of 50 chiemgauer, held together by a rubber band, are sold for $50 Euro at the Waldorf School and several other locations in Prien. At that time 80 local shops were accepting the notes. By September 2004, according to the Goethe Institute, 150 businesses were involved.

Other regional currencies include the Roland in Bremen, and by late 2004, over 40 or more initiatives have been launched. Margrit writes 'The German explosion of regional currencies still keeps me breathless, all the major newspapers and television stations have had reports.'

References:
German Teenagers invent a currency by Mariana Schroeder, Christian Science Monitor, October, 2003 at www.csmonitor.com/2003/1030/p12s02-wmgn.html.

Euro or Chiemgauer? Alternative Currency to support Waldorf School
from www.newmediaexplorer.org/sepp/2004/03/12/euro_chiemgauer_alternative.

Email from Margrit Kennedy to Helen Dew, 11 October, 2004, quoted with permission.


SUPPLEMENT
Announcing the publication of a new report in the 2009 volume of IJCCR (International Journal of Community Currency Research): CHIEMGAUER REGIOMONEY: THEORY AND PRACTICE OF A LOCAL CURRENCY by Christian Gelleri
Read the (15 page) report at http://www.uea.ac.uk/env/ijccr/pdfs/IJCCRvol13(2009)pp61-75Gelleri.pdf