BY BARNABAS MANEBONA
CENTRAL Bank of Solomon Islands (CBSI) clarifies that the new $40 banknote and $2 coin launched is part of the country’s circulation currency.
This means that the public can exchange goods and services with this special commemorative currency as it has been officially declared as legal tender.
CBSI corrects an article published by Island Sun under the headline, ‘Commemorative $40 note produced is not part of circulation currency’.
According to CBSI, the article title has misled the general public.
From brief explanation given by CBSI, the $40 is a circulating commemorative note, which people can use in their daily transactions like the existing circulating notes of $100, $50, $20, $10 and $5.
The commemorative nature of the note however makes the denomination a collectible note or a memorabilia where individuals/firms can use the note as a gift to their friends or visitors or retiring colleagues and so forth.
People must note that there is also an element of rarity in this banknote issue as the Bank had only ordered a limited number of notes meaning that once the stock of $40 is all issued into circulation then that would be it.
It is a one off production meant to celebrate the country’s 40 years of independence.
Another issue the report highlighted was that of a higher value denomination, particularly, why CBSI did not consider issuing a $150 or $200 denomination instead.
“In that connection, people need to be informed that the Central Bank continues to monitor the banknote structure and will introduce a higher value denomination as and when it is appropriate to do so.
“Currently there are five banknote denominations (i.e. $100, $50, $20, $10 and $5) and five coin denominations ($2, $1, 50c, 20c and 10c) in the country’s currency structure,” CBSI explains.
For Solomon Islands, this currency structure is considered ideal given the demand for cash in the economy, for banknotes, their use pattern as payment and market notes.
With these said, CBSI continues to monitor the value/volume of currency in circulation, the number of payment instruments used in the country and cash distribution issues to name a few issues.
CBSI will introduce a higher denomination as and when absolutely necessary as the public will be informed when this happens.