5,000 yen and 1,000 yen
The new designs for the ¥5,000 and ¥1,000 notes. (Bank of Japan)
   

MONEY MAKEOVER:
Redesigned Japanese Currency to Debut in 2004
September 27, 2002

Of the four denominations of paper currency currently in circulation in Japan, three will be redesigned and released in the spring of 2004, the exception being the ¥2,000 note that was just put into circulation in 2000. The changes to the bills - the first in 20 years - announced by the minister of finance on August 2. The ¥10,000 note will undergo a few changes, while both the front and back of the ¥1,000 and ¥5,000 notes will be completely redesigned. The principal aim of the changes is to thwart the growing problem of counterfeiting, but the government also hopes to jump-start the economy through special demand related to the new notes, such as updated software for vending machines.

Featuring Cultural Icons
Of the three notes that will be redesigned, the ¥10,000 note will be changed only slightly, as it has the largest circulation and is familiar to people. The portrait of Yukichi Fukuzawa (1835-1901), a Meiji-era (1868-1912) thinker and the founder of Keio University, will remain on the front of that bill. The image on the ¥5,000 note will change from that of Inazo Nitobe (1862-1933), a pre-World War II educator, to Ichiyo Higuchi (1872-1896), a woman novelist of the Meiji era. Hideyo Noguchi (1876-1928), a bacteriologist, replaces Soseki Natsume (1867-1916), a novelist of the Meiji era, on the ¥1,000 note. The reverse sides of all three bills will be completely redesigned. The proposals to place Noguchi and Higuchi on the bills were made by Minister of Finance Masajuro Shiokawa, who commented, "Previously, most of the people featured on currency have been politicians. The people selected this time were chosen with a broad view to including pioneers from the Meiji era."

Higuchi will be the first woman to be featured prominently on Japanese currency since World War II. The only other examples of women on Japanese bills are Empress Jingu, who appeared on the ¥10 note in the Meiji era, and Murasaki Shikibu, the author of Genji monogatari (Tale of Genji), a small likeness of whom appears on the back of the current ¥2,000 note.

Higuchi was the first professional woman writer in Japan. Even though she had no formal education and endured great hardship in her life, she published waka (31-syllable poetry) and stories one after another before passing away at the age of 24 in 1896. Much of her writing voiced protest over the male dominance of the time and expressed the sorrow of being a woman forced to live in such an age. Even today, many readers find her works moving. Some of her famous stories include Nigorie (Muddy Bay) and Takekurabe (Growing Up).

Noguchi was born into a family of poor farmers in 1876, and though he was severely burned in his infancy, he nevertheless managed to overcome adversity and become educated. Up until the time of his death in 1928 in Ghana, he conducted research on disease-causing bacteria, such as the syphilis spirochete and yellow fever bacteria. Noguchi left behind an impressive body of work, and he was also known for his devotion to his mother. His story has been told in biographies and movies, and he is well-known even today.

Foiling Counterfeiters
The counterfeiting of paper currency has risen greatly in recent years. Between January and June of this year, some 9,825 bogus notes were discovered. This is a pace more than twice as great as that of a year ago and 10 times more than the number of phony bills that were found in 1998. In order to slow this trend, at the end of 2001 the government and the Bank of Japan began to consider the idea of introducing new bills.

Like the new euro notes that were put into circulation at the beginning of this year, the new Japanese bills will feature an abundance of the latest anticounterfeiting technologies. In addition to containing a hologram, the new notes will also reveal writing and numbers when viewed at an angle. And on top of that, they will employ a number of never-before-used, secret anticounterfeiting measures that will not be made public. Use of the embossed identification mark that was introduced with the ¥2,000 note - which is raised higher than the marks on the old bills - will be continued with the new notes. While the raised marks make things more difficult for would-be counterfeiters, they at the same time allow blind people to distinguish among the bills by touch.

Hoping for Economic Effects
In addition to thwarting counterfeiters, the government hopes that the new notes will give the economy a boost by sparking demand for such businesses as vending-machine makers. Minister of State for Economic and Fiscal Policy Heizo Takenaka expressed the view that some economic benefits may be possible, stating, "When the new two-thousand-yen notes were issued, it was estimated that there would be one trillion yen [$8.3 billion dollars] worth of orders for new machines. It is not unrealistic to hope for an impact several times as great this time." For example, it is believed that the cost of equipping an automated teller machine to deal with the new bills - updating its computer software and changing its sensors - comes to about ¥300,000 ($2,500). As there are approximately 152,000 ATMs in banks, post offices, and convenience stores across Japan, more than ¥45 billion ($375 million) in special demand is expected to be created.

In addition to ATMs, vending machines also need to be outfitted to recognize the new notes. There are about 2.6 million vending machines in Japan selling drinks and another 629,000 that dispense cigarettes. Changing the sensor in one of these machines costs more than ¥20,000 ($167). In addition, reequipping the ticket machines at train stations and airports is expected to result in economic benefits worth hundreds of millions of yen.

The Dai-Ichi Life Research Institute estimates the direct economic impact of the changeover to the new currency to be ¥960 billion ($8 billion) over two years, an amount that would boost gross domestic product by 0.2%. Some believe that consumption will also be sparked as small retailers hold special sales to commemorate the issuance of the new notes. It appears inevitable that the introduction of the new bills will lead to increased economic activity.


Copyright (c) 2002 Japan Information Network. Edited by Japan Echo Inc. based on domestic Japanese news sources. Articles presented here are offered for reference purposes and do not necessarily represent the policy or views of the Japanese Government.
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