by Richard S. Ehrlich
RANGOON, Burma -- Imagine if the United States suddenly made all its
currency worthless, overnight, and then printed money denominated only in
weird, "lucky" numbers such as 90-dollar notes, along with a smaller bill
worth an odd 45 dollars, and a 15-dollar bill.
Copyright by Richard S. Ehrlich
Richard S. Ehrlich's Asia news, non-fiction book titled, "Hello My Big Big Honey!" plus hundreds of photographs are available at his website http://www.oocities.org/asia_correspondent
July 1994
Burma Trashes Real Cash and Prints Funny Money, in Odd, Lucky Numbers
To make the economy more twisted, imagine if you went to the bank, or did a
big business deal, and your money was officially deemed to be worth 20 times
less -- compared with when you bought your daily necessities on the street.
And, as a special, strange limit to your new money, you wouldn't ever be
able to use it to buy a major item, such as a car or a television set.
To make any major purchases, you would need special "foreign exchange
certificates," which look like cheaply printed, play money.
Welcome to Burma's bizarre bazaar.
Here in this repressive, hermit, Southeast Asian nation, such funny money is
the way the government's feared, eccentric leader -- known in whispers as
"The Old Man" -- and his military regime manipulate the economy.
As a result, the already destitute majority living in this unfortunate land
have seen their lives go from bad to terrible, while remaining powerless to
publicly complain.
Burma's unusual money is known as kyat, pronounced "chat."
Buying something with a 90-kyat note is the way many transactions are now
done.
Change for a 90 can be given with a 45-kyat note, or a 15-kyat note, or
other combinations, depending on the deal.
Burmese businessmen, and foreign visitors, said in interviews that the
hard-to-multiply, oddball numbers drive them crazy.
To ease the mathematic nightmare, shopkeepers and restaurants often try to
price their goods and services in numbers divisible by 90, such as 270 kyats
for an item, or else round off the price to the nearest 45 or 15 -- which
also makes it easier to give change.
A price tag of 30 kyats is also convenient, because it can be paid by two
15-kyat notes.
And a price tag of 135 kyats is fine, because that requires simply a 90 and
a 45.
The wacky denominations came about because nine is said to be the lucky
number of Burma's aging dictator, Ne Win.
Deeply superstitious and eccentric, he woke up one morning in 1987 and
announced the nation's normal currency was suddenly worthless, with no
compensation, and no way for people to change it into something else.
That meant most Burmese were immediately bankrupt.
The entire middle class, the elderly, and others who had stacked kyats their
whole working lives, lost their entire savings overnight and suddenly became
paupers.
Ne Win apparently thought he was doing something clever to swiftly punish
Burma's wily blackmarketeers who rarely keep money in the bank, preferring
to hold on to it, so they can do shady deals without receipts.
But Ne Win seemingly did not realize that blackmarketeers conducted most
deals in US dollars, and thus enjoyed a buffer from his odd-digit monetary
policy.
Much of the blackmarket trade in Burma involves cross-border purchases in
neighboring Thailand, China, Bangladesh and India, where dollars are the
preferred means of easy exchange,
In those nations, kyats are usually rejected, no matter what numbers are
printed on them.
Ne Win, meanwhile, blithely went on to design new replacement money in his
favorite lucky denominations.
No one was able to question his decisions, because Ne Win is Burma's most
powerful person, though his legacy is slowly being passed on to military
leaders who now act as an unelected government.
But even the military junta knows Ne Win's lucky money is bad luck for
Burma.
In 1994, the military regime quietly introduced a 500 kyat note along with a
100, 50, 20 and other normal denominations.
They apparently felt emboldened after successfully introducing a 200-kyat
note, and others numbers, and a few years ago.
The junta had realized they could not attract investment because foreign
businessmen found out they were using money based on the whims of one
individual.
But the military still can't yank the 90-kyats and other lucky bills without
risking Ne Win's ire.
So they are instead letting his currency notes fall into tatters, while all
crisp new notes have normal values.
Diplomats are meanwhile watching this denomination game to gauge reclusive
Ne Win's strength.
One Western diplomat said in an interview, "Ne Win introduced the 90 and 45
and 15-kyat currency notes.
"But the military has almost admitted they are ridiculous, and are phasing
them out.
"My feeling is Ne Win is no longer the puppet master pulling all the strings
of the government.
"But the military won't do anything he won't want them to do," the diplomat
added.
Despite the cash switch, Burma's blackmarket continues to divide the nation
into two economies.
The official rate is about six kyat to one US dollar, which is the rate used
at the bank and in government contracts.
Everyone else offers a whopping 100 kyats for one US dollar.
Prices at this rate seem more normal, resulting in much of Burma having an
economy pegged at that level.
The diplomat said, "Years ago, the kyat was originally pinned to the
Singapore dollar. But now you see the official rate, and you can see Burma
has done 20 times worse than the Singaporean economy.
The realistic blackmarket rate is actually good for corrupt officials as
well.
The diplomat said, "The blackmarket even benefits officials. The army can
buy at the official rate, and sell at the unofficial rate, and pocket the
difference.
"They want to eventually stabilize the rate, but that would be the final
admittance that they got it wrong."
Because the banks give only six kyat to the dollar, virtually no foreign
tourists ever change their money at a bank.
They instead hand over their dollars to eager shopkeepers, tour guides,
residents and others who discreetly exchange it for 100 or so kyats, which
usually includes a mixture of normal 100s, lucky 90s, and a stack of 10s to
even the total.
The military, however, has retaliated against the dollar-powered foreign
tourists.
To get tourists' foreign cash, the military recently decided to copy
communist China's strange system of "foreign exchange certificates."
Today, upon arrival at Burma's international airport -- next to the place
where you collect your luggage -- each foreign tourist must exchange at
least 300 US dollars for newly printed, foreign exchange certificate notes,
which resemble toy money used while playing board games.
In proud captions, the notes declare themselves: "equivalent to US $1,"
"equivalent to US $5," and "equivalent to US $10."
No mention of kyats appears on the Burmese certificates.
Fortunately for tourists, the dollar-equivalent certificates also fetch
about 100 kyats or so for each dollar's worth, so most visitors learn to
accept them after usually expressing loud shock and indignation in the
airport about having to buy 300 dollars worth.
The only tourists who remain miserable are those who visit Burma for a brief
time, and don't spend all 300 dollars worth of certificates.
The fine print on the receipt says the first 300 dollars exchanged are not
refundable.
The government appears delighted with the scheme because the regime now has
a steady, guaranteed income of dollars from all entering foreigners.
Ne Win's kooky-numbered money, however, is not popular among Burmese when
they relax to play games.
On the board of a counterfeit, made-in-Rangoon game of Monopoly, for
example, players can buy Mandalay for 300 kyats, while the starting square
says: "Collect 200 Kyats Salary As You Pass Go."
None of the Monopoly kyat is denominated in nines.
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