HONG KONG, Jan 7 (AP) -- Hong Kong is urging people to eschew the tradition of stuffing crisp new bank notes into red envelopes given away as gifts during the Lunar New Year holiday that begins this month.

People should put used cash in the gift packets to avoid wasting resources and harming the environment, Monetary Authority Chief Executive Joseph Yam said in a statement issued this week.

The Lunar New Year -- which starts Jan. 29 this year -- is the biggest annual holiday in mainland China, Taiwan and Hong Kong. People usually flock to banks to get newly minted currency to put into their gift envelopes.

Yam said there's usually a demand for about HK$300 million (US$38.7 million; €31.8 million) in new bank notes during the holiday. It takes 400 metric tons (440 short tons) of cotton to make the paper needed to print the currency, he added.

This year, Yam said banks will encourage customers to accept "good-as-new notes" that have been circulating but are still in fine condition.

"Thanks to the use of sophisticated note-sorting machines, the banks are able to sort out dirty and torn bank notes that they receive back from circulation every day," Yam said. "Only bank notes that are reasonably clean and in good condition are released back into circulation."