Main image via iStock
There’s a high possibility that Malaysia could have its currency notes replaced.
In an interview yesterday, Prime Minister Tun Dr Mahathir Mohamad said that he saw the plan as an effective measure to combat corruption and address counterfeit notes.
Another alternative was for the country to embrace cashless transactions. “We are studying how best to reduce corruption and how best to keep track of money that is being spent, especially by the government.” One of the “biggest legacies of the old administration” was corruption, and changing currencies could be a means to address the problem, Tun M suggested.
Image via Perak Today
However, Tun M does admit that such move is no easy task, because in order to replace currency, the government needs to know the amount that’s in circulation.
AmBank group chief economist and head of research Dr Anthony Dass explained that replacing currency notes could be a costly exercise involving complex procedures. It’ll require special papers, millions of metres of security thread, watermarks, ultra-violet features and other anti-counterfeiting mechanisms. Not to mention the changing of currency notes may send a negative message and result in stakeholders’ loss of trust and confidence in the government.
Instead, he recommended two other options. One could be “parallel currency”, where the new currency will be circulated alongside the old currency to pay for taxes, food, and clothing—freeing up the new currency to pay for debt and to stimulate growth. Another option could be going for “digital currency”, which is much easier to design and distribute.
Info via New Straits Times
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