A historic county town was today  launching its own currency in a bid to encourage residents to shop locally.

More than 70 local traders in Lewes, East Sussex, have agreed to accept the Lewes Pound as a complementary currency to pound sterling.

Up to 10,000 one Lewes Pound notes have been designed and will be unveiled at the launch at Lewes Town Hall from 7.30pm.

Organisers say the initiative would help increase a sense of pride in the community, help cut CO2 emissions and boost economic resilience amid the economic downturn.

Branching out: Lewes in East Sussex has set up its own currency to encourage residents to shop locally

Oliver Dudok van Heel, of the Lewes Pound Group, said: 'There will always be a need for a national currency, but it's a question of promoting what can be done locally.'

The move is something of a step back into the past for Lewes, which had its own currency between 1789 and 1895.

Complementary currencies have also been introduced in other parts of the UK and across the world.

In Totnes in Devon, a complementary currency has been running for more than a year and in the US town of Berkshire, Massachusetts, some one million Berkshares have gone into circulation since it started a couple of years ago.

The pilot scheme in Lewes will run until August next year, when a review will take place to determine whether it will continue into its next phase.

Lewes Mayor Michael Chartier, who will officially launch the local pound, said: 'The idea behind it is to encourage as many local people as possible to shop locally.

'Lewes has a tradition of small shops and hasn't got a large number of major chain stores that a lot of other towns have. It has traditionally been the small shops that have given Lewes its unique appeal.'

The Lewes Pound, which was drawn up by Transition Town Lewes (TTL), will be worth a pound sterling and will only be redeemed at locally-participating stores.

TTL is made up of local residents whose aim is to build resilience to the challenges of rising energy prices, peak oil and climate change.

It says one of its key initiatives is to localise the economy and it sees the launch of the Lewes Pound as an important component in promoting trade for local traders and local goods.