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Advisor proposes 1000-yuan banknotes

By Song Wei (chinadaily.com.cn)
Updated: 2009-03-10 16:31

A political advisor has proposed China should issue bigger banknotes like 500 and 1,000 yuan notes to spur domestic consumption and protect the environment.

Zhu Zhengfu, a delegate from southern Guangdong province, made the suggestion at the 11th National Committee of the Chinese People's Political Consultative Conference session in Beijing on March 5, 2009.

“People would have a stronger desire to spend with more money in their wallets. Say when people have a 1,000 yuan note instead of a 100 yuan note in your pocket, would they more likely to buy things? ” said Zhu.

Meanwhile, printing larger value notes saves more paper and benefit the environment, he noted.

It also saves man power, like the note printer, clerks who count money at banks and security staff in charge of the transporting banknotes, he said.

Although a similar suggestion was made years ago, Zhu didn’t think his was simply a repetition of it.

“Times are different now. People used to worry about inflation before because of the overheated economy; but at present with the global economic downturn, people are more concerned about deflation. Therefore, it’s the right time to issue bigger bank note,” Zhu said.

Zhu had done some research about currencies in major economies prior to making his suggestion.

The largest US dollar note is 100 (684 yuan), for Euros it’s 500 (4,346 yuan), for the Japanese yen it is is 10,000 (693 yuan) and the UK pound is 50 (473 yuan).

“Compared to these world major economies, the face value of Renminbi is not big enough,” Zhu said, “and I think the issuance of a larger valued bank note will come true sooner or later.”

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Advisor proposes 1000-yuan banknotes