Canadian Bank Note Company Limited Statement

Canadian Bank Note Company Limited

09.02.05

Governor, Deputy Governors, senior officers of the Bank of Zambia (BOZ). On behalf of the Canadian Bank Note Company (CBN), I should like to thank you for inviting us to Lusaka to join this press briefing. Ladies and Gentlemen of the Press, I hope that we will be able to clarify any matters relating to our role in the provision of your polymer substrate banknotes.

Since it first became apparent that the 2003 issue of polymer notes were showing signs of accelerated wear, BOZ and CBN have been working hard to ensure that we fully understand this phenomenon which has not been seen in the other 22 countries where polymer notes have been issued since 1988.

We recognised that a solution had to be found quickly but also knew that it was of even greater importance to take all possible measures to ensure that the new notes were as resilient to this type of wear as modern technology could make them.

Consequently, every aspect of the 2004 notes has been checked and cross checked and, where appropriate, we have brought in consultants from other organisations with specific and relevant experience and skills. We have involved respected institutions and individuals from around the world in this project.

The problems of accelerated wear, or as it has been frequently referred to, “fading”, were found to be in some of the inks used for the 2003 issue. Those inks that were wearing more quickly than expected have been changed for the 2004 issue.

These changes are not experimental. This note specification was earlier adopted by the Bank of Mexico printing works for the 20 Pesos denomination. These notes have been circulating in Mexico for over two years and the Bank has reported they are very satisfied with their performance in circulation and they shortly intend to expand their polymer programme by introducing the 50 peso polymer denomination in 2006.

From commencement of work on the 2004 issue, we were required to report to Bank of Zambia in detail on every aspect of the testing and every stage of production of these notes. At the very beginning, it was agreed between the Bank and CBN that quality and thoroughness would be the priorities, even if this meant that the project took longer than initially envisaged.

All the evidence we have points to the 2004 issue performing much better in terms of ink wear than the 2003 issue. Once this is borne out in circulation, as we confidently expect, Zambians will continue to enjoy handling much cleaner notes than the paper predecessors of these denominations and the Bank of Zambia will achieve the significant long term savings in procurement, distribution and administration costs that were its original objectives for polymerisation.

I should like to thank the Bank of Zambia for the highly professional and thoughtful manner in which they have dealt with this matter and the Zambian people for their patience and understanding.

Kevin Pritchard

Vice President – Marketing