State-owned currency printers create financial intel risks
- CEE Staff
- Mar 3
- 10 min read
Updated: Nov 6
Outsourced currency printing creates economic security vulnerabilities in emerging economies
Executive Summary
State-owned or affiliated currency printing operations by aggressive states increasingly represent a previously underappreciated vector for economic statecraft. Chinese and Russian state printers are leveraging currency contracts to collect financial intelligence, enable sanctions evasion, and create economic leverage at the expense of economic sovereignty.
Chinese and Russian printers are actively gaining market share through below-market pricing and exploitation of sanctioned environments.
Dozens of countries continue to outsource currency production to state-affiliated entities with the willingness and ability to abuse currency printing contracts.
Printing contracts are an emerging focus for gray zone tactics like Triad counterfeiting and Russian oligarchic expansion across secure documentation, holographic printing, and biometric identification supply chains.
As such, outsourcing currency printing creates opportunities for macroeconomic distortion, geopolitical manipulation, and money laundering/sanctions evasion in emerging economies. This assessment carries moderate confidence, based on documented patterns of below-market bidding, contract manipulation, and observable instances of economic and political exploitation through currency relationships.
Outsourced Banknote Printing is Common
Outsourcing currency production to external entities is a common practice among emerging markets, driven primarily by cost considerations, access to advanced security features, and more efficient production capabilities. This trend is particularly pronounced in cash-dependent economies where cost advantages often outweigh security implications.
Domestic printing facilities require substantial capital investment—typically $50-100 million for modern security printing equipment—plus ongoing maintenance costs and specialized technical expertise. Many central banks find state-affiliated external printers offer 15-30% cost savings while providing advanced anti-counterfeiting features like polymer substrates, color-shifting inks, and microprinting that domestic facilities cannot economically produce.
This cost-benefit analysis is particularly acute in high-inflation environments where frequent currency redesigns are necessary, and in cash-intensive economies where physical currency comprises 30-60% of the money supply. The immediate budgetary relief and technical advantages typically overshadow the long-term strategic vulnerabilities created by such dependencies, especially when central bank operating budgets are under political pressure.
For example, Argentine President Javier Milei suspended domestic banknote production at its national mint in October 2024, citing high costs and production delays. A month later, China's CBPMC (China Banknote Printing and Minting Corporation) won a lowest price technically acceptable contract, joining US-based Crane in handling all Argentina printing. This was in line with the Argentine government’s cost savings drive and came despite Milei’s anti-Chinese views during the campaign. Some corners of Argentine media criticized the deal on security grounds. Yet China’s nominal respect for sovereignty appeals desirable for a country which is hiding the location of its old reserves for fear of ‘vulture’ hedge funds seeking to seize Argentina assets to enforce a $ 16.1 billion ruling against the country.
Nepal works with CBPMC for similar reasons combined with the need to print politically sensitive notes featuring disputed territories. Bangladesh partially outsources production to CBPMC, while Bhutan, Brunei, and Cambodia fully outsource to external producers like UK-based De La Rue.
Currency Printers Market Landscape
According to De La Rue's 2023 annual report, state print works are responsible for producing around 86 percent of global notes currently in circulation, with commercial printers accounting for the remaining 14 percent. Within the private market, the United Kingdom’s De La Rue leads with approximately 30% market share, printing approximately one-third of global banknotes for around 140 central banks.
Germany’s Giesecke+ Devrient holds approximately 20% market share with strong European and Asian central bank contracts. And the US’s Crane Currency maintains about 10% market share with contracts from the US Federal Reserve and international clients in Latin America and Asia. Recently acquired by Crane NXT, the company is focusing on polymer note technologies.
Company | Market Share (Estimated) | Contracts | Risk Factors | Recent Activity |
De La Rue (UK) | 30% | Prints ~1/3 of global banknotes for around ~140 central banks in Europe, Africa, The Middle East and Caribbean | Concentrate risk for intel penetration or hacking activity | Closed operations in Kenya after 25+ years, leaving only three banknote production sites (UK, Malta, Sri Lanka) |
Giesecke+ Devrient (Germany) | 20% | European and Asian central banks, strong EU contracts | Potential economic leverage through supply disruptions | Increasing investment in digital banknote security tech |
Crane Currency (USA) | 10% | US Federal Reserve, Latin America and Asian central banks | Dependence on external suppliers, risk of geopolitical tensions | Split off into printing and industrial tech companies; focus on polymer note technologies |
China Banknote Printing and Minting Corporation (CBPMC) | 10% | China domestic currency printing, regional exports | Integration into China’s strategic initiatives, leveraging Economic espionage, diplomatic leverage | Adoption of advanced polymer banknote technology. 2024 contracts include Argentina, and Nepal |
Oberthur Fiduciaire (France) | 8% | Moderate global presence with contracts in West and Central Africa and Europe | Moderate exposure to geopolitical risks | Expansion into digital currency security features |
Goznak (Russia) | 7% | Russian domestic printing, limited exports to CIS nations and ideological allies/rogue regimes | Potential for political weaponization, including sanctions evasion, currency counterfeiting and manipulation | Strengthened ties with Russian financial authorities. Sanctioned for printing Libyan currency without approval and assisting the Assad regime |
Canadian Bank Note Company (Canada) | 4% | Domestic focus with selective global contracts | Limited risk due to smaller and carefully chosen global footprint | Strengthened domestic printing capabilities |
Security Printing and Minting Corporation of India | 5% | India domestic currency, limited regional exports | Supply chain vulnerabilities, reliance on external tech | Modernization of printing facilities, exploring regional exports |
Fábrica Nacional de Moneda y Timbre (Spain) | 3% | Spain domestic currency focus, selective international | Limited exposure, mostly domestic | Updating domestic currency security features |
South African Bank Note Company | 2% | Regional contracts across Southern Africa | Regional reliance risks due to geopolitical shifts | Increased production to support regional currency demands |
Others | >1% | Other smaller state-owned producers in countries like Iran, Zimbabwe, and Sudan | Dependence on external technologies and imports, relatively low operational or security capacity | Entering partnerships with larger producers to enhance security measures given increasing instances of forfeiting |
Geopolitical Printers Gain Market Share
The market is undergoing consolidation, with state-owned entities increasingly competing against established Western commercial printers. State-owned currency printers from China and Russia particularly have been rapidly expanding their global footprint since around 2015.
China Banknote Printing and Minting Corporation (CBPMC) is the world's largest coin and paper money producer with over 18,000 employees across 10 facilities – compared to De La Rue’s 1,800 across 3 facilities – primarily addressing domestic currency printing. Since its first international contract for Nepal's 100-rupee note in 2015, CBPMC has secured approximately 10% of global market share, appealing to pragmatic governments in Asia and Latin America seeking cost-effective solutions. Over the past ten years, CBPMC has quickly expanded from domestic production to serve economies like Thailand, Bangladesh, Sri Lanka, Malaysia, Nepal, India, Brazil, and Poland. However, the true scale of its global market is opaque, with client central banks often requesting confidentiality clauses in contracts, with at least five central banks prohibiting public disclosure of their printing arrangements to avoid domestic political scrutiny.
Russia’s Goznak on the other hand primarily serves sanctioned regimes and Russia-aligned states in Africa, the Middle East, and CIS which are unable to access Western printing services. With production capacity of 11,000 tons of protected banknote paper and 7 billion banknotes annually, Goznak had established itself as one of the world's largest cash producers; also producing up to 3.5 billion coins, 40 million passports, and 30-45 million postage stamps annually. The SOE controls approximately 7% of the global banknote market and 15% of the banknote paper market, supplying currency to at least 25 countries across four continents. International orders constitute roughly half of Goznak’s total production, including Lebanon, Syria, Yemen, Guatemala, Venezuela, Rwanda, Angola, Indonesia, Nigeria, and India.
These state-affiliated currency printers are capturing market share with aggressive bidding practices that consistently undercut Western competitors. In Argentine’s October 2024 private bidding round, CBPMC bid $11.5 million for a 240,000 bill March order and $14.7 for a 300,000 bill July order. The Chinese printer presented the sole offer for the first tranche, which was between 14% and 42% cheaper than the other four unnamed bidders. These alternatives most likely a combination of Crane (US), De La Rue (UK), Giesecke+ Devrient (Germany), or Oberthur (France).
Goznak similarly offers pricing advantages to targeted clients, though often with less transparent terms and bundled with other financial arrangements. Both Goznak and CBPMC frequently include preferential financing terms, extended payment schedules, and reduced requirements for foreign currency reserves. These are critical advantages for cash-strapped emerging economies with limited hard currency, and the type of benefits which reflect the strategic role such currency contracts play in the economic influence campaigns of Beijing and Moscow.
Western commercial printers face structural disadvantages, operating with 30-45% higher labor costs, 3-to-5-year technology refresh cycles that require substantial capital investment, and growing shareholder pressure for profitability. Major Western firms have also increasingly divested their authentication businesses—De La Rue sold its product authentication division in late 2024, and Crane Currency separated its currency and authentication operations —increasing the complexity and cost of offerings.
These Western printers now typically charge premium rates of $80-120 per thousand notes versus $55-75 from state-affiliated competitors, attempting to justify the premium with quality control, established reliability, and political neutrality.
Currency Contracts as a Point of Leverage
Far from just gaining market share, these state-affiliating printers offer a previously unreported vector of economic influence. These contracts open the door for State-affiliated currency printers to exploit their position for intelligence gathering and influence operations through several mechanisms. Involvement in currency production reveals sensitive insights into a nation's monetary policy, anti-counterfeiting measures, and financial stability efforts.
Detailed knowledge of security features facilitates the detection of vulnerabilities and allows printers to replicate the currency. Control over production and distribution logistics also reveals information about currency release timing and volumes that can inform broader geoeconomic strategy or visibility on geopolitical investments. More emboldened state printers could embed tracking technologies or unique identifiers in printed currency to trace the movement of banknotes, gathering intelligence on financial flows and spending patterns.
State-affiliated printers have already manipulated currency supply through deliberate introduction of excess currency to drive inflation, create artificial shortages, or fund combatants:
In Yemen, counterfeit Yemeni riyals produced by Goznak have been funneled into the conflict-ridden economy, providing illicit budgetary support to actors circumventing the Central Bank of Yemen, with the deliberate injection of fake currency contributing to weaponized inflation and significant devaluation of its riyal.
Goznak used the design specifications for legitimate Libyan contracts to counterfeit over $1.1 billion of dinars, in part to fund Wagner group operations, according to 2024 US Treasury sanctions. The volume was so large that the Eastern-based Central Bank noticed the accompanying increase in inflation.
Historical precedent exists for such operations: during World War II the British government directed De La Rue to use original plates to reproduce Thai baht notes to fund resistance fighters and bribe officials in Japan-allied Thailand. In 2011, the British government barred De La Rue from fulfilling its contract to send dinar notes to Libya under Muammar Gaddafi, creating currency shortages across the cash-based economy
Case Studies and (Mis)Use Cases
Venezuela and Macroeconomic Instability
In February 2020, Venezuelan President Nicolas Maduro contracted Goznak to print 300 million new banknotes with face values ranging from 10,000 to 50,000 bolivars. The total value of this order was approximately $7.4 million. This order, worth about $143 million in face value at the time, constituted around one-fifth of Venezuela's money in circulation at the time. Outsourcing to Goznak came from years of hyperinflation which devalued Venezuela's currency and impoverished millions of its citizens, in turn undermining opposition and strengthening the government’s grip.
Nepal and Diplomatic Power
In October 2024, Nepal Rastra Bank (NRB) awarded a contract for printing 300 million 100-rupee banknotes, with the CBPMC previously printing the countries 5, 100, and 1,000 rupee notes. The contract, valued at approximately $8.99 million, is noteworthy not just for its size but also for its political implications. These new notes feature Nepal's revised political map, which includes the disputed territories of Lipulekh, Limpiyadhura, and Kalapani. This decision effectively reinforces Nepal's territorial claims over areas that India considers part of its Uttarakhand state.
Syria and Sanctions Evasion
Goznak facilitated Syrian sanctions evasion through a complex printing arrangement designed to obscure attribution. In 2012, Goznak produced 240 tons of Syrian banknotes through a covert operation using Cypriot intermediaries to mask the direct relationship with Damascus. This arrangement coincided with intensified U.S. and EU sanctions on the Assad regime, when conventional financial channels were restricted. Evidence indicates further financial cooperation continued, with Syrian Central Bank records showing $250 million in cash transfers to Moscow in 2018-2019 to pay off the regime’s Russian debts.
Libya and Counterfeiting for Operational Finance
Goznak has printed billions of dinars for the Central Bank of Libya in Tobruk - backed by the non-UN recognized Eastern government in the country’s fragmented dual government system. Yet the company went beyond the contract printing billions in unauthorized dinars used to fund rival groups, entrenching divisions and deepening dependence on external actors. There are also credible reports that the supply of counterfeit notes helped fund Wagner group operations protecting oil infrastructure in the east and south.
Yemen and Counterfeiting for Proxy Support
Counterfeit Yemeni riyals produced by Goznak have provided illicit budgetary support to actors circumventing the Central Bank of Yemen. These counterfeit notes are effectively indistinguishable from legitimate currency, financing Houthi activities while devaluing the riyal. This devaluation has eroded purchasing power, compounded humanitarian challenges, and further destabilized Yemen’s fragile socio-economic environment. This pattern parallels tactics employed by Iran’s Iran’s Islamic Revolutionary Guard Corps-Qods Force, which has utilized the country’s Rayan Printing to produce counterfeit Yemeni riyals for proxy operations, suggesting a systematic approach to using currency production as a simultaneous tool for operational support, economic warfare, and sanctions evasion mechanism across multiple conflict zones.
Implications and Responses
The proliferation of outsourced currency printing relationships with state-affiliated printers will continue to create previously underappreciated security and economic vulnerabilities, particularly in emerging economies with limited domestic printing capacity.
Key Implications
Economic sovereignty is threatened when nations outsource currency production, creating persistent vulnerabilities to financial intelligence collection and manipulation.
Aggressive states gain geopolitical leverage through currency dependency, particularly in economically constrained partner economies where cost considerations outweigh security implications.
Counterfeit currency facilitates money laundering and sanctions avoidance, in turn making financial systems more vulnerable to monitoring, manipulation, and disruption.
As the surface area of competition expands to economic sectors previously insulated from geoeconomic concerns, security must expand beyond standard corporate protocols. The expanding risk surface area in economic security and statecraft requires vigilance and clear consideration of the cost-security tradeoffs, in emerging markets vulnerable to exploitation.
Recommended Responses:
Finance Ministries: Implement procurement standards requiring bidders to meet specific security clearances and transparency requirements, even in lowest-price technically acceptable contract scenarios.
Central Banks: Increased monitoring of currency production contracts, focusing on pricing anomalies, unusual contract terms, and intermediary companies with opaque ownership structures.
Western Central Banks: Establish technical capacity development programs for emerging economies to establish domestic printing capabilities or regional partnerships for critical currency security features.
Political Leadership: Adopt Brazil's outsourcing model, diversifying providers across multiple jurisdictions to minimize the leakage of economically relevant details and the potential for supply disruptions
Western Intelligence Organizations: Monitoring polymer signatures, ink formulations, and other technical indicators to attribute and validate the use of state-affiliated printing operations in money laundering and broader gray zone tactics.
This report is part of the Geopolitical Economy program’s new series on the expanding risk surface area of economic security and statecraft in emerging markets.
The ideas expressed here do not necessarily reflect the views of the Center for Emerging Economies.
Comments