The scenery in this corner of eastern Nepal is spectacular, nestled between the world’s highest mountains and the tea plantations of India’s Darjeeling region, where rare orchids grow and red pandas frolic on the lush slopes.
But life can be tough. Wild animals destroyed the corn and potato crops of farmer Pasang Sherpa, who was born near Mount Everest. A dozen years ago, he abandoned these plants in favor of one that seemed to have little value: Algeri, an evergreen yellow-flowered shrub that grows wild in the Himalayas. Farmers grow it for fencing or firewood.
Little did Mr Sherpa know that the bark peeled from his ajri would one day turn into pure money – the product of an unusual trade in which Asia’s poorest One of the regions provides a major component to the economy of one of the wealthiest regions.
Japanese currency is printed on special paper, which is no longer available in the country. The Japanese love their old-fashioned yen notes, and this year they need plenty of fresh yen notes, so Mr. Sherpa and his neighbors have a lucrative reason to cling to their hillside.
“I did not expect these raw materials to be exported to Japan, nor did I expect that I would make money from this factory,” Mr. Sherpa said. “I’m happy now. This success came out of nowhere, it grew out of my yard.”
Kanpou Incorporated, headquartered 2,860 miles away in Osaka, produces paper used by the Japanese government for official purposes. One of Kanpou’s philanthropic projects has been conducting surveys in the Himalayan foothills since the 1990s. It went there to help local farmers dig wells. Its agents eventually stumbled upon a solution to Japan’s problems.
Japan’s traditional paper used to print banknotes, Mitamata paper, is running out of supplies. The paper uses wood pulp from the Thymeaceae plant, which grows in high-altitude, sunny, well-drained tea growing areas. Rural depopulation and climate change are forcing Japanese farmers to abandon labor-intensive land.
Kanpou’s president at the time knew that mitsumata originated in the Himalayas. So, he thought: Why not transplant it? After years of trial and error, the company discovered that Algeri’s hardier relative was already growing wild in Nepal. Its farmers just need tutoring to meet Japan’s strict standards.
After the 2015 earthquake devastated much of Nepal, a quiet revolution began. Japan dispatched experts to the capital Kathmandu to help Nepali farmers carefully make raw materials for cold hard yen.
Soon, the instructors arrived in the Ilam area. In the local Limbu language, “Il-am” means “Twisted Road,” and the roads there don’t disappoint. The road from the nearest airport was so rough that the first jeep needed to be replaced midway – for a more rugged four-wheel-drive vehicle.
By then, Mr. Sherpa was already involved in the industry, producing 1.2 tons of usable bark annually, cutting the ajli sheepskins himself and boiling them in wooden boxes.
The Japanese taught him to use plastic bundles and metal pipes to steam off the bark. What follows is the arduous process of stripping, beating, stretching and drying. The Japanese also teach their Nepali suppliers to harvest each crop three years after planting and before the bark turns red.
This year, Mr. Sherpa has hired 60 local Nepalis to help him process the harvest and expects to earn 8 million Nepali rupees (about $60,000) in profit. (The average annual income in Nepal is about $1,340, according to the World Bank.) Mr. Sherpa hopes to produce 20 tons of the 140 tons that Nepal will ship to Japan.
That’s the bulk of the Mimata ships needed to print the yen, enough to fill about seven containers and wind their way downhill to the Indian port of Kolkata, where they sail another 40 days to Osaka. Hari Gopal Shreshta, general manager of Kanpou’s Nepal branch, oversees the trade, inspecting and purchasing neatly tied bales in Kathmandu.
“As a Nepali,” said Mr. Shreshta, who is fluent in Japanese, “I feel proud to be managing the raw materials for currency printing in wealthy countries like Japan. This is a great moment for me.”
This is also an important moment for the Japanese yen. Every 20 years, the world’s third most traded currency undergoes a redesign. The current banknote was first printed in 2004 and its replacement will be available in July.
The Japanese love their beautiful banknotes, with their elegant, understated moiré patterns printed on tough off-white plant fibers rather than cotton or polymers.
The country’s attachment to hard currency makes it an outlier in East Asia. Less than 40% of payments in Japan are processed by card, code or phone. In South Korea, the figure is about 94%. But even for Japan, life is becoming increasingly cashless. The value of its currency in circulation is likely to peak in 2022.
The Bank of Japan went yen-for-yen to reassure everyone that there were still enough physical banknotes in circulation. If all these bills were stacked in one place, the height would be 1,150 miles, or 491 times the height of Mount Fuji.
Before the discovery of the yen trade, Nepali farmers like Sherpa had been looking for ways to immigrate. Hungry wild boars are just one problem. The lack of decent jobs is a killer. Mr. Sherpa said he was ready to sell his land in Ilam and move, perhaps to work in the Persian Gulf.
Years ago, 55-year-old Faud Bahadur Khadka, now a content Algri farmer, had a painful labor experience in the Gulf. In 2014, he went to Bahrain, promising a job at a supply company, but ended up working as a cleaner. Despite this, his two sons went to work in Qatar.
Mr. Khadka said he was happy that “this new agriculture has helped people to some extent get money and jobs.” He was hopeful: “If other countries also use Nepali crops to print currency,” he said, “This will deter Nepalese migration to Gulf countries and India.”
The warm feeling is mutual. Tadashi Matsubara, current president of Kanpou, said: “I want people to know how important Nepalese and their Mimata are to the Japanese economy. To be honest, without them, the new banknotes would not be possible.”
Kiuko Notoya contributed reporting from Tokyo.
