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[EDITORIALS]Size matters

Published: 21 Dec. 2006, 22:21

Soon 50,000-won and 100,000-won bills may no longer be a dream. Both the ruling party and the opposition have agreed and the Finance Ministry, which had been concerned about some negative aspects of large denomination bills, has said it will be difficult to oppose both the ruling and the opposition parties. The Bank of Korea, in charge of printing notes, said once the subject and design of the large denomination bills has been determined, it could start printing them by the end of 2008.
The idea of introducing large denomination bills has been on the mind of many for quite some time. Concern from the government and some political quarters that such notes could be used in bribery or tax evasion have prevented officials from taking the steps required to make the move.
But the benefits of having these bills far outweighs any negative impact. For instance, we could save up to 440 billion won a year by replacing the 100,000-won personal checks with banknotes. Also, with the large denomination bills, it would be easier to pay for goods and services in business transactions as the economy grows. Above all, a currency structure that includes large denomination bills would befit a Korean economy that is now among the largest in the world.
Since introducing the 10,000-won bills in 1973, our economy has grown 130 times, and the consumer price index has jumped 12 times. A single 10,000-won bill cannot pay for a meal for two people. Worldwide, only 33 nations, mostly destitute ones, have their highest denomination bills valued at lower than our 10,000-won bills.
The anxiety over the possible use of the large denomination bills in bribery and tax evasion has subsided. Besides, it is up to the law enforcement authorities, not banknotes, to prevent corruption. Now that the political parties have agreed to it, we urge the government to take the next step toward printing large denomination bills.