Demonetization In Various Countries Of Globe

When a country completely replaces its old currency with a new currency, this act is known as demonetization.

Demonetization is really important at times, the action would curtail the shadow of the economy and reduce the use of illicit and counterfeit cash to fund illegal activity and terrorism.

THERE ARE SEVERAL COUNTRIES WHERE DEMONETIZATION WAS APPLIED:

1) INDIA:  Demonetization was applied in India on November 8, 2016, also known as   'NOTE BANDI'. Old notes of 1000 and 500 were made invalid by the government and new notes of 500 and 2000 were introduced. During this time people faced many problems such as financial crises and huge losses in business. The objective of demonetization in India was to demolish the black money culture.

2) PAKISTAN:  In December 2016, demonetization was applied in Pakistan. State Bank of Pakistan (SBP) issued new designs of banknotes, the designs of 10, 50, 100, and 1000 rupee were changed. The objective was to prove security and durability of the Pakistani banknotes.

3) AUSTRALIA (1996):  First in Australia had issued paper-based notes but they replaced those notes with banknotes of the same denomination. It was done in order to curb black money and improve security.

4) BRITAIN: In 1971 the old currency of pens and pond was discontinued. The government introduced new coins of 5 and 10. The objective of demonetization was to bring uniform currency circulation.

5) NORTH KOREA: Demonetization was applied in North Korea under the dictatorship of Kim Jong 2. The objective was to bring economic prosperity and to eradicate black money. But in North Korea demonetization was not at all successful. Citizens became really angry, they witnessed an increase in the price of goods and utilities.

Demonetization can affect a country both positively and negatively, it also depends on the government or leader of the country that how he or she manages the situation.

By: Tanushka Sharma

Class 11

Bharat National public School