“Cash Circulation: Models, Standards, Tendencies”, 25-26 November 2010, Russia, Moscow, President Hotel

«15th Anniversary of Tenge: Public Respect and Trust»

26/12/2008 | Daurenbek MAZHITOV, Director of the Department of Cash Circulation, National Bank of the Republic of Kazakhstan
Banknotes of the World

On 15 November 2008 the national currency in the Republic of Kazakhstan, tenge, celebrates the 15th anniversary of circulation. During these fifteen years the Kazakh money changed their design, security features, and production materials. The only thing that remained intact is the public respect and trust. In 2006 a representative jury consisting of leading experts of the International Association of Currency Affairs (IACA) named the new series of Kazakh tenge
the winner in the nomination "The best new banknote or banknote series". Russian banks having partners in Kazakhstan included tenge in the list of currencies they work with and serve their clients. What role did the introduction of national currency 15 years ago play in the development of the Republic of Kazakhstan?

Following the demise of the USSR and the independence of Kazakhstan the necessity emerged to reform the entire banking and credit system and its transformation into an effective instrument operated under the conditions of the market economy. In April 1993 the president of the country signed the laws "On the National Bank of the Republic of Kazakhstan"1 and"On banks and bank activities in the Republic of Kazakhstan". These laws granted the National Bank the powers on pursuing an independent monetary policy and determining the demand for the necessary banknote and coin volumes, ensuring the manufacturing, establishing an order of their depositing, destroying and collecting. Starting 1 January 1993 the Republican currency fund was formed.
On 3 November 1993 by the Edict of the President of the Republic of Kazakhstan the State committee of national currency was formed and started to manage the work on the introduction of the national currency. Taking into account the situation in the negotiations on the establishment of the united ruble zone, the State committee decided that it was necessary to urgently introduce the national currency. It was suggested to name it "tenge" after a medieval coin "tanga" circulated on the territory of Kipchakia.
Tenge was introduced into circulation on 15 November 1993 on the entire territory of the country. By the moment of introducing the national currency, the gold and currency assets of the country supposed to ensure the stability of the national currency came to $452 million2. The necessary volume of new banknotes, due to the absence of own printing capacities, was printed in UK within a very short time period.
The introduction of the own national currency became an important step on the way of filling the country’s sovereignty with a specific content. Its introduction gave way to pursuing an independent monetary policy. The main efforts of the National Bank during these years were focused at curbing the inflation rate. As a result during the last five years we managed to decrease the annual inflation from 2165% in 1993 to 17.8% in 1999. From 2000 to 2006 the inflation was maintained at a one-digit level.
By now the Kazakhstan banking system is considered the most reformed segment of the financial system of the country. The overall calculated owner’s equity of banks of the second level as of 1 September 2008 came to almost 2 trillion tenge (12% increase from the beginning of 2008), and the aggregate assets of banks came to 12.6 trillion tenge (7.5% increase).
Though starting 1 January 2004 ensuring the stability of prices became the main task of the National bank, nevertheless the National bank retained the task of promoting the stability of financial system.
How was the national currency made? In order to make seven denominations a team of designers headed by T. Suleymenov was formed, which also enlisted M. K. Alin and A. Duzelkhanov. The banknote design must be both esthetic from the point of view of the artistic idea and performance, and rather practical from the point of view of the further mass production, i.e. printing. It was necessary to decide what the banknotes would look like in their historical concept. There were a lot of versions: to place portraits of historical personas on the banknotes or to feature important historical events happened on the territory of the modern Kazakhstan; or whether it should be subjects from fairy tales and eposes or even natural landscapes of endless steppes, beautiful mountains and views of flora and fauna. In the long run it was decided to place portraits of historical personas, who reflect the Kazakh cultural heritage in the best way. The back of the banknotes was left for natural and architectural elements characteristic for the country.
1 tenge: on the face — a portrait of philosopher, scientist and thinker Al-Farabi, living on the brink of IX-X Centuries in Otrar town in the south part of Kazakhstan. He wrote more than 100 treatises out of which 32 remained until now. On the back of the banknote are images of geometric constructions and formula by the scientist.
3 tenge: Suyunbay Arotuly is one of the best representatives of the democratic trend in poetry and the art of singing, who is known for his talent and improvising abilities. Being an akyn (folk singer) in his poems Suyunbay reflected a heroic fight of Kazakh people against conquerors, described traditions and moral principles of people. The back of the banknote features mountains of Trans-Ili Alatau.
5 tenge: A famous composer Kurmangazi Sagyrbaiuly was a well-known performer of instrumental music who created a new direction of compositions for domra — kuy. He devoted his entire life to the fight against social injustice and suppression, tyranny and despotism of rulers and was persecuted by the authorities. On the back of the banknote is a complex of mausoleums.
10 tenge: Chokan Velikhanov — an outstanding scientist, enlightener and democrat, researcher of history and culture of Kazakhstan and Middle Asia. On the back of the banknote is a landscape with a view of the Ok-Zhetpes mount.
20 tenge: Abay (Ibragim) Kunanbaev was a great poet and philosopher of Kazakh people, the founder of Kazakh literary language. His literary works represented an absolutely new stage in the development of both artistic and socio-political and philosophical thinking of the society of that period. On the back of the banknote is an image of a hunter with a falcon after the motifs of Abay’s works.
50 tenge: Khan Abulkhair was for his time and the history as a whole a diplomat, a military commander and a statesman who thanks to his organizing and commanding abilities managed to put Jungar invasion to Kazakh land to an end. It was Abulkhair who being a far-sighted politician and in the conditions of a permanent threat of seizure by the Chinese empire and the Jungars, chose the protection of the Russian empire in order to keep the Kazakh state. On the back of the banknote are the petroglyphs — rooky paintings found in Mangistau mountains and representing the ancient art of Kazakhstan.
100 tenge: Kazakh khan Ablay-khan, descendant of Chingis-khan, the most respected statesman of Middle Asia in XVIII century. He showed himself as a talented organizer and courageous warrior in the fight against Jungar conquerors and was proclaimed a batyr. On the back of the banknote is a fragment of the mausoleum of Khodja Akhmed Yasavi.
Having determined the number of historical persons to be featured on the first Kazakh banknotes, the designers faced another difficulty — the necessity to reproduce their appearance as correct as possible. The problem was that there was no portrait of the majority of these persons. For example, nobody knows how Al-Farabi actually looked like. Some time ago his portrait was taken as a standard by the Academy of Sciences of the USSR. However, it took a lot of time to restore the portrait of the scientist in the archives. The portrait of khan Abulkhair was found in the works by British traveler Atkinson, and a portrait of Ablay-khan was taken from Russian sources. The image of Suyunbay was borrowed from the works of A.Kasteev, founder of paintings in Kazakhstan.
After the first tenge series was issued, it became necessary to put higher denominations into circulation the real needs of the country. In 2006 new series of banknotes appeared united by a single idea and rendition.
Made in a single style the banknotes of 200, 500, 1,000, 2,000, 5,000 and 10,000 tenge have a strict color spectrum, modern security features thus witnessing the rise of professionalism of Kazakh designers. New processes of the industrial production of banknotes — machine readable features, variable scaled numeration, and watermarks with an added electrotype — this is far from the complete list of characteristic features of these banknote series.
The new design banknotes of 2006 completely exclude a possibility of misperception of any denomination, as all denominations differ both in color and dimensions. The color spectrum was chosen in a way to create a positive and easily recognizable image of banknotes of any denomination. Each successive denomination is larger than the preceding one by 4 mm in length and 3 mm in width. In the center of the face is depicted a monument Astana-Bayterek — an achievement of the modern Kazakh architecture and engineering, a symbol of the development of independent Kazakhstan. In the middle of the banknote on color stripes are fragments of the notes of the national anthem of the Republic of Kazakhstan, overprinted with the numerals of the denomination. To the left of the Bayterek monument is the national emblem of the Republic of Kazakhstan in single color. In the upper right is the national flag. At the bottom of the banknote is an open hand that in classic heraldic symbolizes faith, sincerity and justice. On the back of the banknotes there are the pictures of landscapes and modern architectural objects of the country. They are framed with a contour of the Kazakhstan map (Editorial note: Detailed descriptions of the design and security features of the Kazakh tenge of 2006 see: BoW, September 2006).
After the 15 years passed since the date of introducing the national currency it is sure that the tenge is quite established as a national monetary unit. During the time of independence, Kazakhstan carried out considerable economic reforms, successfully established market relations, and reached high and stable economic growth.

1 The date of adoption of the law "On the National Bank of the Republic of Kazakhstan" is considered its establishment.
2 As of early October 2008 the gold and currency assets of the National Bank came to $21.9 billion. As a whole the international reserves of the country (the gold and currency assets of the National Bank plus the funds of the National Fund of the Republic of Kazakhstan) as of early October 2008 came to $49.5 billion or increased more than 100 times during the last 15 years.