With the introduction of new notes after banning Rs500 and Rs1000 currency notes, India is coping with demonetisation. The measure taken up by the Prime Minister of India isn’t new, however, as several other countries have introduced and implemented it in the past. Out of which some met the purposes, whereas some failed miserably.
Here is a list of eight countries that have embraced demonetization before India…
- Nigeria
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During the government of Muhammadu Buhari in 1984, Nigeria introduced new currency and banned the old notes. However, the debt-ridden and inflation hit country did not take the change well and the economy collapsed.
- Ghana
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In 1982, Ghana ditched their 50 cedis note to tackle tax evasion and empty excess liquidity. This made the people of the country support the black market and they started investing in physical assets which obviously made the economy weak.
- Pakistan
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From December 2016, Pakistan will phase out the old notes as it will bring in new designs. Pakistan legally issued the tender a year and a half back, and therefore, the citizens had time to exchange the old notes and get newly designed notes.
- Zimbabwe
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Zimbabwe used to have $100,000,000,000,000 note. Yes, a one hundred trillion dollar note! The Zimbabwean economy went for a toss when President Robert Mugabe issued edicts to ban inflation through laughable value notes. After demonetisation, the value of trillion dollars dropped to $0.5 dollar and were also put up on eBay.
- North Korea
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The demonetisation that happened in North Korea in 2010 left people with no food and shelter. Kim-Jong ll introduced a reform that knocked off two zeros from the face value of the old currency in order to banish black market.
- Soviet Union
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Mikhail Gorbachev ordered to withdraw large-ruble bills from circulation to take over the black market. The move didn’t go well with the citizens which resulted into a coup attempt which brought down his authority and the led to Soviet breakup.
- Australia
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Australia became the first country to release polymer (plastic) notes to stop widespread counterfeiting. Since the purpose was to replace paper with plastic and only the material changed, it did not had any side-effects on the economy.
- Myanmar
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In 1987, Myanmar’s military invalidated around 80% value of money to curb black market. The decision led to economic disruption which in turn led to mass protests that killed many people. Most of the information posted above is baseless. Zimbabwe had introduced new high notes to tackle inflation and it’s not called demonetisation. North Korea collapsed due to pressure from world community on its nuclear tests which India also suffered from 1970’s 1990’s. Pakistan due to its own terrorism. Like ways all the countries mentioned above were not collapsed by demonetisation
