GoodFriends: Research Institute For North Korean Society

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North Korea Today No. 310 Hot Topics December 2009

[“Good Friends” aims to help the North Korean people from a humanistic point of view and publishes “North Korea Today” describing the way the North Korean people live as accurately as possible. We at Good Friends also hope to be a bridge between the North Korean people and the world.]
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[Photos] New Currency of North Korea
At 9 am, the Central Telephone Bureau blocks Telephone Lines in Pyongyang City prior to the Currency Exchange
At 10 am, Announcement of Party Propaganda to the Party Headquarters in all Provinces, Cities, Counties of the Nation
Central Party and Finance Ministry Conduct Classes for its Core Officials on the Currency, and Two-Day Training for the Currency Exchange Workers
Contents of Currency Training
The Outcome of the Currency Exchange will be the Material Guarantee for Building and Transforming into the Strong and Prosperous Nation
Issues Emphasized at the Currency Training
Announcement of Currency Exchange was a Success “Due to meticulous regulation and organization”
Currency Exchange Procedures
Delay of Issuing Small Notes to Suppress the Market
After Currency Exchange, Everyone Gets 500 Won for Free
Market Expected to Function January Next Year
All Factories and Companies Halt Production for a Week
People’s Reactions after Currency Exchange
Investigations Underway at Households Where Death is Reported
Offers Made to Destitute People for Dividing the Old Currency at the Ratio of 70% to 30%
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[Photos]New Currency of North Korea

At 9 am, the Central Telephone Bureau blocks Telephone Lines in Pyongyang City prior to the Currency Exchange
On November 30, at around 9 am, prior to the announcement of currency exchange measures, the Central Telephone Bureau completely blocked all automatic process in their branches in all areas of Pyongyang City. This action was to prevent “the leak of any secret regarding currency exchange and (causing) exchange of conversation regarding the national sovereignty” through telephones.

At 10 am, Announcement of Party Propaganda to the Party Headquarters in all Provinces, Cities, Counties of the Nation
On November 30, 2009 at 10 am, the North Korean government announced its propaganda to the residents through the Party in all cities and provinces including Pyongyang. It was decided that, “In the year of transformation as the Strong and Prosperous nation, in order to bring comprehensive changes, a new currency would be exchanged” and an emergency action was announced.

Central Party and Finance Ministry Conduct Classes for its Core Officials on the Currency, and Two-Day Training for the Currency Exchange Workers
The Central Party and the Finance Ministry conducted classes for its core officials on the currency exchange as well as a two-day training for the currency exchange workers regarding ‘the order of currency exchange.’ Party members from the province went to the District Administration Offices to conduct the training on the currency exchange to the currency exchange workers. For the currency exchange, Party members from the cities and provinces, Securities, Police Stations, Courts, and other judiciary staff were mobilized. For example, if there were 10 District Administration Offices, 18 currency exchange teams were organized and given training before beginning currency exchange operations.

Contents of Currency Training
The major thrust of the training was to explain the reasons and purpose of the currency exchange as an emergency measure. “The fundamental purpose of the currency exchange is to improve the lives of the laborers, office workers, and farm members from the current level to a higher level.” The explanations are as follows:
“Due to the nationwide circumstances and various natural disasters, farming had been poor for several years. As there were problems in securing food for the residents and feeding them, the living standard had deteriorated for several years. The Great General’s desire is to open the gate to the Strong and Prosperous Nation, eliminate any shortage of food, and let people live happily in the Strong and Prosperous nation, lacking nothing. Our great leader, while he was alive, said that his greatest joy would be to have the people eat beef soup, wear silk cloths, and live in houses with tiled roof.” A Strong and Prosperous Nation is to be built by April 15, 2012 and people would live in enormous prosperity. The purpose of the currency exchange is clearly to build the Strong and Prosperous Nation. It was further explained that “Since our money were old and in poor shape, the new Finance Minister proposed the currency exchange measure. It’s also being done in order to improve the quality of the new currency to the global standard.”

The Outcome of the Currency Exchange will be the Material Guarantee for Building and Transforming into the Strong and Prosperous Nation
If the currency exchange is done successfully, in the year to open the gate to the Strong and Prosperous Nation, under the leadership of the Party, 10 million people will bring to fruition (the efforts) of 150 day battle, 100 day battle and (it would be) the material guarantee.

Issues Emphasized at the Currency Training
The Central Party emphasized the following items to the currency exchange workers.
First, there should be no wrongdoing by the workers mobilized to do the currency exchange. Second, the wrongdoings of the currency exchange workers dispatched to the District offices will be considered as treason for the building of the Strong and Prosperous Nation. Third, there should be absolutely no instances where the residents with no money exchange currency for the people with lots of money and receive payment for that.

Announcement of Currency Exchange was a Success “Due to meticulous regulation and organization”
The North Korean government evaluated that on the day for currency exchange, due to the meticulous regulation and organization, there were no scheming or illegal behaviors by the workers.

Currency Exchange Procedures
The following is how the North Korean authority distributes new currency by exchanging with the old one. Each head of Neighborhood Units collects 100,000 NK Won from each household and brings it in an envelope with the ID card of the head of the household and his personal stamp to the District Administration Office. There, officials check it with the registered Neighborhood Unit household list and count the money. They check every note, even those as small as 10 NK won. If the issue number of an old note is unidentifiable or the note itself is too old and fragile, they consider it invalid and do not accept. Broken notes glued together have to be separated again to check the issue number. Only after passing the strict scrutiny can they be exchanged with the new currency. The head of Neighborhood Unit receives the new notes and delivers them to each household. In this way, the exchange process is executed from Neighborhood Unit No.1 of a District Administration Office to the next.

Delay of Issuing Small Notes to Suppress the Market
The new notes already distributed are 200, 500, and 1,000 NK Won notes. It is said that new notes for 10, 20, 50, and 100 NK Won are already issued, but they are not distributed yet. This is to discourage the use of new notes until new state prices are set. Market activities are hindered because sellers cannot give the change without small notes even if residents want to buy something from them.

After Currency Exchange, Everyone Gets 500 Won for Free
The government is planning to distribute free money after the currency exchange has completed in all District Administration Offices. The free money will be 500 NK Won to each person, regardless of age. A household of two persons will get 1,000 NK Won, 4 persons 2,000 NK Won, and 5 persons 2,500NK Won. The reason they give away 500NK Won per each one in a household in addition to the basic exchange limit of 1,000 NK Won per household is “to let them eat and live well without suffering in the mean time.”

Market Expected to Function January Next Year
Party Officials in rural areas anticipate the current market abnormality will continue throughout December. The management of Soonam Market, in Chungjin City, North Hamgyong Province announced to sellers that sale items stored in the market must be removed. “This might be to eliminate many prohibited items from the market”, according to a management officer at the market. He foresaw that due to the currency change it would be difficult to circulate cash even after the government announces new prices. An official in Pyongsung City predicted with caution that the market will recover only in January 2010. However, the government will complete the currency exchange in a week to reduce uncertainty and inconvenience in people’s lives and let them buy necessary items with the new currency in state-run shops and markets. At the same time, the authorities are reinforcing Party worker programs to help households with insecure livelihood.

All Factories and Companies Halt Production for a Week
Currently, all the factories and companies have stopped production for a week during currency change.

People’s Reactions after Currency Exchange
Cases of heart attack or death are reported among residents who went into shocks triggered by sudden currency exchange. Other residents, who have saved money through hard work in their business since Arduous March, could not withhold the shock of their hard earn money evaporating like bubbles. In the evening of November 30, a laborer who works at a daily goods factory in Hoesang district, Hamheung city, South Hamgyong Province died unexpectedly because he could not endure the shock. He has been suffering from a heart disease already, but he was totally devastated by the loss of the 1.3 million NKW he had saved for his son who was discharged from the military last August and scheduled to have a wedding at the end of the year. He had rushed to countryside and looked for poor family with no money to make an offer of dividing the money in the ratio of 70% to 30%, but he could not avoid a huge loss. Around 11pm that night he fell on the ground while going to restroom and died at the spot because of a severe injury to the head. A law enforcement agency visited the house to determine the exact cause of his death the next day.

Investigations Underway at Households Where Death is Reported
In the midst of aggravated sentiments among people law enforcement agents started to conduct investigations on the cause of death for those who died after the announcement of currency revaluation. The purpose of investigation was to determine whether the deceased actually died of an accident or committed suicide out of protest.

Offers Made to Destitute People for Dividing the Old Currency at the Ratio of 70% to 30%
On November 30 in Hamheung city, South Hamgyong Province, as soon as the news of currency revaluation was announced there were many attempts of people looking for people with no money and make the offer of dividing the money at the ratio of 70% to 30%. Especially, those who engage in business went to countryside and made offers to the farmers that they will give the farmers 300 NKW and take 700 NKW for themselves if the farmers can do the currency exchange for them. There were numerous such cases where the merchants in every district market in Hamheung city give up their business for the day and looked for poor people with no money.

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