The Indochina Piastre: A Colonial Currency’s Rise and Fall

A unit of currency imposed in 1885 across the entire Indochinese territory, the trade piastre long embodied the financial power of France in the Far East. Yet behind this façade lies a history of scandals, trafficking, and monetary dislocation that would hasten the end of the French presence. A look back at a coin that reveals much about the fragilities of the colonial system.

A Single Currency for Five Territories

At the dawn of colonization, Indochina was a monetary mosaic. In Tonkin, Annam, Cochinchina, Cambodia, and Laos, a jumble of copper sapèques, Siamese ticals, Mexican pesos, and Japanese yen circulated. Treaties of commerce signed with the Western powers in the mid‑nineteenth century only added to the confusion.

The French administration put an end to this chaos in 1885 with the creation of the piastre de commerce. Struck at the Paris Mint, this silver coin weighing 27.215 grams became, two years later, the sole legal tender of the Indochinese Union. For the first time, five territories shared the same monetary standard. The unity was administrative and political; it now became monetary as well.

“The piastre was the foundation of French domination. Without it, there would have been no coherent economic policy,” recalls colonial‑economic historian Pierre Brocheux in his work on Indochina.

Yet this unity concealed all kinds of compromises. In Tonkin, a zinc coin worth six‑hundredths of a piastre was struck in 1905 to suit popular exchange, while rice prices continued to be quoted in sapèques in the Annamite countryside.

From Silver to Scandal: The Story of a Monetary Drift

Until 1920, the piastre was backed by silver, like its ancestor the Mexican peso. The First World War upset the balances: the soaring price of silver forced the authorities to suspend convertibility. A first link to the French franc was established, but without a solid anchor. In 1931 the tie became official: one piastre was worth ten francs.

The post‑war period reshuffled the cards. On December 26, 1945, the French high commissioner in Indochina, Admiral d’Argenlieu, set a new rate: one piastre would now equal seventeen francs.

The decision aimed to prevent inflation imported from the metropole. It produced the opposite effect: the black market seized the gap.

For several years, trafficking on an unprecedented scale flourished. In Saigon, Hanoi, and even in Paris, organized circuits bought piastres on the parallel market at the real rate (around ten francs) and resold them to the French Treasury at the administered rate of seventeen francs. The difference, paid by the taxpayer, amounted to about 8.50 francs per piastre. The “piastre affair,” revealed from 1950 onward, implicated senior military officers, high officials, and several parliamentarians. According to investigator Jacques Despuech, Emperor Bảo Đại, former high commissioner Émile Bollaert, Generals Mast and Revers, and former minister Paul Giacobbi would have been involved. François Mitterrand served as Minister of the Colonies from 1950, while René Bousquet headed the Banque de l’Indochine.

The scandal shook the Fourth Republic. Between 1952 and 1953 it emerged that the Việt Minh likewise profited from the system, using the proceeds to buy weapons, some of which were turned against French soldiers. On July 2, 1953, a parliamentary commission was formed. On December 12 of that year, the National Assembly decided to keep its proceedings confidential. In the meantime, a team of specialists from the commission left for Indochina on September 1, 1953, to gather evidence. The plane crashed in the French Alps; there were no survivors. On board were also the great violinist Jacques Thibaud and pianist René Herbin.

Prime Minister Laniel’s government eventually devalued the piastre to ten francs in April 1953, ending the trafficking and sealing its financial death long before its political demise.

What Could You Buy with a Piastre?

The purchasing power of the piastre, like its history, divides into two distinct periods.

At the end of the nineteenth century, the silver piastre had considerable value. In 1868, in Saigon, a meal at an establishment on Catinat Street, the European heart of the city, cost on average 1.5 piastres. For local populations these sums were out of reach. A coolie’s daily wage in plantations or on the docks ranged between 0.20 and 0.30 piastres.

In the 1930s, the fixed rate of ten francs pegged the piastre in a stable relationship with the metropole. The quintal of rice, the basis of diet and a barometer of the regional economy, traded between three and four piastres. A substantial sum for an agricultural laborer earning about 0.50 piastre per day.

The post‑war period, by contrast, marked its collapse. An official report from October 1950 stressed that “price indices expressed in piastres reflect an increase relative to 1949 that is sometimes of the same order of magnitude as French indices, and sometimes even higher.” The same document noted that “on the black market in Saigon, gold is traded at rates that reveal a depreciation of the piastre of around 60 percent.

” Archives of the high‑commissioner’s office in Saigon indicate that the volume of commercial transactions in piastres rose from 32 billion in 1948 to 66 billion in 1950, a surge that reflected less real activity than inflation and speculation. The 500‑piastre notes, issued in large quantities by the Japanese during the occupation and then by the French authorities, circulated massively. French soldiers, paid in francs, rushed to parallel‑exchange markets, especially in Cholon, Saigon’s Chinese district, where the piastre lost value day by day.

The Legacy: Three Currencies for a Vanished Empire

When the Geneva Accords were signed in 1954, the piastre was dying. Each new independent state—Vietnam (which remained divided until 1975), Cambodia, and Laos—adopted its own currency.

Yet all chose to preserve a link with the former unit of account, a discreet sign of colonial monetary continuity. The Vietnamese dong, the Cambodian riel, and the Laotian kip thus arose from the debris of the piastre. An “Institute of Emission of the Associated States” was created to manage the transition.

Today, collectors eagerly pursue the last silver pieces struck in Paris. But the story of the trade piastre goes far beyond numismatics. It recounts an attempt at economic unification without genuine territorial anchoring, and that of an empire whose monetary abuses foreshadowed, long before military defeat, its inevitable end. As historian Daniel Leplat wrote, the business circles of Indochina waged “a perpetual little war” against the administration, turning colonial dirigisme into “opportunities” for the Banque de l’Indochine and the great trading houses.