Among existing features, the new Thai series will introduce a watermark depicting the portrait of a Thai King alongside denominational electrotype that is visible when held to the light; a windowed colour-shift security thread located on the back of the note that changes colour from dark blue to red when viewed from different angles; irregular shapes of a see-through register printed on the front and the back of the notes that combine to form the denomination numeral when the note is held to the light; raised printing of letters and numerals; and two tactile marks in the shape of flowers in dark blue representing the Braille number 5.

The design of the new series – known to the Bank of Thailand as Series 16 – depicts Thai kings from different periods throughout the country’s history. The 50-Baht note features the portrait of HM King Bhumibol Adulyadej.

“The thinking behind the new look is to honor the Thai Kings of the Sukhothai, Ayutthaya, Thonburi and Rattanakosin periods, to visually improve and update the banknotes, to develop counterfeit-protection measures and to assist blind people dealing with the banknotes,” Dr Prasarn Trairatvorakulm Governor of the Bank of Thailand, told the Phuket Gazette this week.

The 50-Baht note will be followed by the release of new 20, 100, 500 and 1,000-Baht notes. The Phuket Gazette reported that the entire series isn’t expected to be in circulation until the end of 2026.

The release of the new banknote series comes less than a week after politicians in Thailand’s opposition party warned the government not to force the central bank to cover the country’s public debt.

The Thai government had proposed shift the public debt of Bt1.14 trillion to the Bank of Thailand’s account, but critics said the move would lead to hyperinflation and a severe devaluation of the Thai currency.

SOURCES:
Thailand Business News: “The Bank Of Thailand Launches New Series of Banknotes”
Phuket Gazette: “New 50-Baht Banknote In Phuket By This Weekend”
The Nation: “Govnt Debt Policy Will Make Currency ‘Worthless’”

In their proposed 2012 fiscal plan, the Thai government is attempting to borrow Bt400 billion to finance the budget deficit and intends to borrow another Bt400 billion in order to finance restoration projects that are necessary to help rebuild the country after it was struck by major flooding in the spring of 2011. On top of this, the government has also announced efforts to shift the public debt of Bt1.14 trillion to the Bank of Thailand’s account.

“The government’s plan to force the central bank to repay the debts of the Financial Institution Development Fund would result in the printing of more money for the government,” said Democrat MP Sansern Samalapa. “People would be happy for a while, for there would be no need to pay taxes, but then the banknotes would become worthless paper.”

Printing more money than needed is a dangerous road, writes MSNBC Senior Producer John W. Schoen.

“If you create more currency without raising the value of the whatever backs that currency, the value of the currency drops,” he says. “Currency is really just a piece of paper that stands for something of value. Increasing the amount of currency without increasing the value it represents just makes the currency worth less than when you started.”

Samalap provided examples of Latin American countries who tried to undergo similar debt shifts, and who ended up in situations of hyperinflation leading to the collapse of their economies.

Michael K. Salemi, an economics professor at the University of North Carolina, provides an account of one of these situations, which occurred in Bolivia.

“The Bolivian hyperinflation is a case in point. Eliana Cardoso explains that in 1982 Hernán Siles Suazo took power as head of a leftist coalition that wanted to satisfy demands for more government spending on domestic programs but faced growing debt service obligations and falling prices for its tin exports,” he writes. “The Bolivian government responded to this situation by printing money. Faced with a shortage of funds, it chose to raise revenue through the inflation tax instead of raising income taxes or reducing other government spending.”

Hyperinflation, Salemi says, always reduces an economy’s efficiency due to the fact that it drives people away from monetary transactions.

SOURCES:
The Nation: “Govnt Debt Policy Will Make Currency ‘Worthless’”
MSNBC Answer Desk: “US Budget Deficit Fix: Print More Money?”
The Concise Encyclopedia of Economics: “Hyperinflation”

Electronic passports contain a small electronic chip – an RFID chip – embedded in the cover that contains key information about the passport carrier such as their name, gender, date of birth and a digital photograph of the carrier.

Some electronic passports contain biometric information as well and require digital confirmation of physical attributes such as fingerprints and iris patterns, though the new St. Kitts and Nevis passports will stick to basic information.

The Ministry of Foreign Affairs and Homeland Security said the new passports will not only expedite travel for citizens between the two Carribean islands, but will also help prevent fraud and identity theft.

“The new document to be issued by the Government of St Kitts and Nevis is more secured and designed with specific imbedded features intended to enhance the integrity of the new E Passport and will facilitate more seamless travel by citizens and residents of the Federation,” the ministry stated.

St. Kitts and Nevis is one of the first countries in the region to use electronic passports.

“We are proud to be once again be leading the way in ensuring that citizens of our twin-island Federation are given an added layer of protection whenever they travel,” Elvis Newton, Permanent Secretary in the Ministry of Homeland Security told SKN List. “The new passports do cost more, but we are confident that nationals will understand the added cost of producing these digital passports, and will appreciate the expedited processing at various ports where they travel, when compared to those persons who do not have upgraded passports.”

Non-electronic passports are still valid in the region, though anybody requesting a new passport as of this month will be issued an electronic passport.

SOURCES:
SKN List: “New Passports Offer Added Security Features”
Caribbean 360: “St. Kitts Begins Issuing Epassports”

Marred by what the European Commission deemed “fiscal and macroeconomic imbalances built up over the decade,” many financial analysts say the euro is in trouble. Countries such as Ireland, Spain and Italy have all been marked by high debt levels and threats of recession, particularly in the last three to four years.

As recently as this week, Greece announced it would be looking for bailout money to the tune of 130 billion euros. “The bail-out agreement needs to be signed,” said government spokesman Pantelis Kapsis told Greek television outlets. “Otherwise, we will be out of the markets, out of the euro.”

However, if countries such as Greece attempt to discard the euro and return to their original national currency, this is not a process that can take place overnight. In fact, experts in the banknote industry say it will take a minimum of one year before any particular countries can revert to another currency.

Before banknotes can be processed, they have to be designed, developed and equipped with security features to prevent counterfeiting. These elements must be assembled before being shipped to the paper maker, which can take three to four months. After that, the notes are sent to the security printer who must undergo at least six to eight different processes to get the notes ready for circulation.

“When we look at the eurozone it is very challenging to contemplate the logistics behind that,” Chad Wasilenkoff, CEO of Fortress Paper – a company that manufactures banknotes – told BNN in December. “It could be easier if one country such as Greece were to fall off, but if the whole thing were to come crumbling down it’s just not logistically possible.”

Despite the length, an article published by RT.com last month said central banks throughout Europe are preparing contingency plans evaluating their needs for additional printing capacity should the euro come to an end.

SOURCES:
The Malta Independent: “Little To Celebrate As Eurozone Marks 10-Year Anniversary”
RT.com: “Highway To Hell? Greece Barrels Toward Euro Exit”
RT.com: “Plan B: Printing Presses on Standby To Beat Euro’s Demise”
The Globe and Mail: “Video: Can Printing New Currencies Keep Euro Zone United?”

“In the fourth quarter [of 2011] we once again began printing the paper 10 ruble note, as banks had begun to complain of a deficit of the coins,” Central Bank head Georgry Luntovsksy told The Moscow News.

The plan to remove the banknotes was due to the Bank’s belief that the low-value note (worth 30 US cents) was too costly to reproduce and was impractical to contemporary currency users. When they made the decision to nix the paper banknote, the Bank of Russia anticipated they would save approximately 18 billion ruples over the following decade.

This isn’t the only move the Bank has been making with regards to the ruble. After a volatile year that saw the currency fall nearly 17 per cent from its year high amid fears of a euro zone collapse, the Bank announced this week it would allow more daily fluctuations in ruble trading.

According to the Wall Street Journal, market experts say this step could very well “anticipate higher volatility in the currency due to instability abroad and political uncertainty at home.”

“Ultimately, we think the central bank expects pressures on the ruble to mount in one direction or another due to a variety of possible reasons, including geopolitical risks in the Middle East and euro-zone as well as domestic politics, and is working to increase the flexibility of the system,” Alexei Moiseev, chief economist at VTB Capital, told the Wall Street Journal.

Russia’s central bank has gradually taken a more hands-off stance on managing the ruble as it moves to a policy of inflation targeting and an eventual free float of its currency, the financial magazine reported.

“The regulator last widened the ruble’s trading band on March 1, expanding it to five rubles from four rubles.”

SOURCES:
The Moscow Times: “10-Ruble Banknote Being Printed Once Again”
The Wall Street Journal: “Russian Central Bank Widens Trading Band”

The bogus bills were being produced in an apartment mostly with an inkjet printer. When the RCMP arrived to raid the apartment, the process of manufacturing the bills was not yet completed, said Sgt. Tony Farahbakhchian or the E Division Federal Commercial Crime Section.

“He didn’t quite have the finished product yet,” he said.

According to The Province, the bills had been printed three to a sheet on one side only and a watermark and puzzle number were missing. Security features such as security threads, foil strips and holographic stickers had also not been added.

Farahbakhchian told The Province that the quality of the notes varied, but overall they were average reproductions.

He also urged the public to pay close attention to their banknotes and to be aware of the security features, especially during the holiday season when counterfeit money can be easier to spread due to busy stores and the amount of money being exchanged.

Though the Bank of Canada introduced a new, more secure, polymer $100 bill in November, these fakes were modeled after the old series, which is still in active circulation.

Trevor Frers, from the Bank of Canada, applauded the raid.

“For the RCMP to seize over $1 million in counterfeit notes before they enter circulation, that’s a huge victory against counterfeiting,” Frers said.

According to RCMP, The Province reports, the overall passing of counterfeit bank notes has decreased since 2004 due to upgraded security features. The new polymer $100 note is expected to reduce counterfeiting even more and increase durability.

SOURCE:
The Province: “Cops Seize $1 Million In Fake Bills”

According to an article published by RT.com, central banks throughout Europe are preparing contingency plans evaluating their needs for additional printing capacity should the euro – a singular currency shared by seventeen countries – come to an end.

The Central Bank of Ireland, for example, is assessing the capacity of their banknote facilities where they currently manufacture new euro bills. Last year, Ireland printed 127.5 million 10-euro notes.

“The bank’s printing capacities may not meet demand should the country need to come up with a hasty replacement for the euro,” RT.com said. “Officials are discussing reactivating old printers or
enlisting a private contractor to do the job”

Last week, in a segment that aired on PRI’s The World, banknote manufacturers and economists also said the industry could see some increased businesses if the euro collapses.

But it’s not all good news. A source from the Bank of England told the Wall Street Journal they were “concerned that if the eurozone unravels, the plant would be overwhelmed with orders and would not be able to print pounds. Britain is reportedly considering steps to ensure that such contingency would not cause damage to the UK’s own interests.”

Among other countries, Switzerland, Montenegro, Bosnia and Latvia are all beginning to look at post-euro plans should the currency bloc fail. To do that, RT reports, “they are now casting around for a new reference point – probably the German mark.”

SOURCES:
RT.com: “Plan B: Printing Presses on Standby To Beat Euro’s Demise”
PRI’s The World: “Making Money by Making Money”

Wasilenkoff said that even though countries may pull out of the eurozone and revert back to their old currency, that process is lengthy and cannot happen overnight.

“Typically a national bank will take anywhere from three to four years to develop a new currency to be able to push it out into circulation in a normalized fashion,” he said Tuesday.

Before banknotes can be processed, they have to be designed, developed and equipped with security features to prevent counterfeiting. These elements must be assembled before being shipped to the paper maker, which can take three to four months. After that, the notes are sent to the security printer who must undergo at least six to eight different processes to get the notes ready for circulation.

Even in the case of a crisis, the minimum time frame to introduce new banknotes into circulation is close to a year. This is the biggest challenge countries face with regards to re-introducing country-based banknotes as opposed to the multi-country unified currency of the euro, said Wasilenkoff.

“When we look at the eurozone it is very challenging to contemplate the logistics behind that,” he said. “It could be easier if one country such as Greece were to fall off, but if the whole thing were to come crumbling down it’s just not logistically possible.”

Currently in the eurozone there is close to 15 billion individual euro banknotes in circulation right now, valued at nearly 875 billion. This represents about 30% of the total global supply of banknotes, Wasilenkoff said.

Watch the whole video HERE.

SOURCE:
The Globe and Mail: “Video: Can Printing New Currencies Keep Euro Zone United”

That price tag reflects the modifications that will need to be made to sorting and counting machines that are used across the country to handle money, says Julie Girard, spokeswoman for the Bank of Canada.

“In Canada, we have 500,000 machines that accept, dispense or sort bank notes,” Girard said, adding that includes about 75,000 Automated Teller Machines (ATMs).

The new bills are drastically different than the old cotton-paper notes that are still in circulation. The new series is made of polymer, a plastic substrate, and is equipped with multiple new security features such as a transparent window embedded with a metallic image, in an effort to curb counterfeiting.

Polymer is more durable – 2.5 times (seven years) longer than its cotton-paper counterpart – and weight approximately ten per cent less than the current bills.

In November, business leaders throughout the country criticized the new notes precisely because of the cost they would incur. Ted Bronsan, president of John Poulet Cheque Writer Service, said the new security features would pose some problems for small businesses.

“Probably 99 per cent of the market uses money counters with optics,” Brosnan explained to CTV.

However, Girard says the benefits of the new notes outweight the problems – and the costs – that these businesses will see, noting that this is a short-term problem with long term remunerations.

“We knew the transition was going to be a little more involved with polymer but the security and all the benefits were really important,” she said. “Polymer is what makes those benefits possible.”

The new $100 bill, the first in the polymer series, was released in November. The next bill in the new series to be released will be the $50 bill and will enter into circulation in March 2012. The other denominations in the series, the $20, $10 and $5 bills, will all be in circulation by the end of 2013.

SOURCES:
UPI: “New Canadian Banknotes Cost Banks $100M”
CTV: “Polymer Bills Could Cause Businesses Headaches”

The first time counterfeiting hit the radar of the Bank of Canada in major way was in the 1980s. In an effort to combat the up-and-coming technology of colour photocopying, the bank introduced a new series of banknotes with finer detail and new security features.

“Fine details in the face and hair of the Queen and former Prime Ministers depicted on the bills were too finicky for photocopiers to handle and appeared fuzzy in reproductions. A shiny gold metallic patch placed on each bill turned dark when replicated, further thwarting the forgers,” Globe & Mail writer Grant Robertson writes.

As technology advanced, Canada’s currency did not. Home computers became more affordable, graphics software was readily available, scanners were commonplace and ink-jet printers became the default for many households. Counterfeiting suddenly became easier than ever.

By the late 1990s, “the number of fake Canadian bills rose as high as 117 parts per million (PPM). Most G20 nations used 50 PPM as their benchmark to stay below,” says the Globe and Mail.

In 2002, 16 years after their last series was issued, the Bank of Canada introduced a new series to thwart the “computer-savvy do-it-yourself counterfeiter.”

Again, new security features were added to the note to ensure it would prevent forgeries. In particular, the new series featured a shiny holographic stripe down one side of the bill that shimmered in the light as well a watermark that appeared hidden but showed up when held to the light.

Four years later, in 2004, counterfeiters were learning to replicate the holographic stripe setting in motion the need to create a new series. In an attempt to create a product that was not only more secure but also a product that was more durable. For banks, the cost of producing new banknotes to replace damaged or used notes can be expensive. Polymer notes are typically two and half times more durable, according to the Bank of Canada.

In November, the Bank introduced the first polymer banknote in a developing series – a new $100 bill that contains several state of the art security features such as raised ink, a large transparent window that also contains a colour-shifting metallic portrait, hidden numbers in the transparent window that match the note’s denomination, transparent text, a frosted maple leaf window that also contains hidden numbers, among others.

Developing new banknotes in a timely fashion is one way for banks to stay ahead of counterfeiters.

“Counterfeiting rates have fallen steadily in Canada in recent years,” says the Globe and Mail. “The country now reports a parts-per-million ratio of below 40, which is finally in line with what most G20 nations consider acceptable.”

To read the full Globe and Mail feature, click HERE.

SOURCE:
The Globe & Mail: “Funny money: How counterfeiting led to a major overhaul of Canada’s money