GoodFriends: Research Institute For North Korean Society

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North Korea Today No.307-308 Hot Topics November 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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[Hot Topics No. 307]
On November 30, North Korea Conducts Currency Revaluation in a Surprise Move
All Commercial Transactions Will be Suspended Until December 6
Residents are in Panic and Confusion at the News of Currency Revaluation
College Students at Dormitories, Allowed to Exchange up to 30,000 won
In Hoeryong, Currencies Are Collected at Neighborhood Units for Collective Exchange

[Hot Topics No. 308]
Additional 500 won in New Currency to be Paid to Those Who Go to Work
Cities Remain Silent as if Under Martial Law on the Second Day of Currency Revaluation
Currency Exchange Yet to be Reported
Attempts to Relinquish Money in Countryside Have Been Blocked
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[Hot Topics No. 307]
On November 30, North Korea Conducts Currency Revaluation in a Surprise Move
On November 30, North Korean government announced currency revaluation.
According to the announcement, each household is allowed to exchange up to 100,000 won and the exchange rate is 100 to 1, that is, each family can exchange 100,000 won into 1,000 won in new currency. Any existing currency exceeding 100,000 won owned by a family will be worthless. The possibility of rich people attempting to have poor families owning less than 100,000 won exchange for the rich is allegedly handled by separate measures by the government. Exchange of the currencies is to continue until December 6. After that date, only the new currency will be legally circulated. North Korean government is known to have decided to restore the current market prices to the levels prior to the Economic Management Reform Measure of July 1, 2002.

All Commercial Transactions Will be Suspended Until December 6
All commercial transactions will be suspended during the period of currency exchange until December 6. Already all the services and trade networks, including sauna, public bath-houses, barber shops and restaurants, stopped operations. Long-distance bus service as well as peddling has stopped as well. Any activities requiring monetary payments will be suspended until new currency will be legally circulated. The purpose of the currency revaluation is to crush private commercial activities, considered to promote anti-socialism. After December 6, old currencies will be worthless.

Residents are in Panic and Confusion at the News of Currency Revaluation
Residents of Sinuiju, North Pyongan Province seem to be in disappointment, panic and confusion, complaining with sighs, “The money I made in preparation of winter sacrificing two months in peddling just turns into water bubbles. It saps all the energy from my whole body. Now what am I going to do?” Jang Chulwoong (alias) spoke of the shocks residents were feeling. “Nobody knows what tomorrow will bring. Those with less than 100,000 Won might stay calm, but many residents with money are in panic and confusion.”

College Students at Dormitories, Allowed to Exchange up to 30,000 won
College students living at the dormitories are allowed to exchange up to 30,000 won. College administration locked the entrances of the dormitories. Currency exchange is conducted while the students are kept out of contact with outside. Its purpose is to keep the extra currency from being exchanged. Authorities intend to close all the paths through which currencies could be exchanged in some other ways until December 6. No student could exchange more than 30,000 won. Every student will end up with the maximum of 300 won in new currency, no matter how much they might own now.

In Hoeryong, Currencies Are Collected at Neighborhood Units for Collective Exchange
Currency exchanges began at 2 pm in the City of Hoeryong, North Hamgyong Province. Heads of Neighborhood Units collect currencies from each family in the unit and collective exchange is done at the District Administration Office. Originally the exchange was supposed to be done at the neighborhood unit meetings on November 30, but only collection was done on that day. New currency will be distributed beginning December 1.

[Hot Topics No. 308]
Additional 500 won in New Currency to be Paid to Those Who Go to Work

While up to 100,000 won can be exchanged per household, those who go to workplace will be paid additional 500 won per person. If four family members go to work, they will receive additional 2,000 won on top of the base amount, which is 1,000 won. This is known to be a measure to encourage people to go to workplace.
Meanwhile, North Korea government is telling people to submit the extra old currency beyond 100,000 won in the name of reserve fund and not to discard them. The government said it will prepare measures after watching how the situation progresses.

Cities Remain Silent as if Under Martial Law on the Second Day of Currency Revaluation
The streets of major cities, such as Pyongyang, Pyongsung and Sinuiju, are quiet as if they are under martial law. The only sound heard is detailed rules of the currency exchange, which is broadcasted every two hours, repeated three times each time. In markets, signs are posted saying, "Closed for a week." On the day the currency revaluation started, city dwellers went to countryside to purchase things, assuming that people in rural area would not have learned the news.
In Sinuiju, school teachers even left classes and rushed to rural areas to buy rice on bicycles.
Farmers were first excited that a crowd of city residents would buy a bowl of rice paying as much as 30,000 won, but soon their excitement turned into disbelief after learning about the revaluation.

All commercial activities have been suspended ever since, and now people cannot buy or sell even a piece of candy. In Pyongyang, the order was made effective at 5 am, November 30, and at 9 am in Pyongsung. It is said that a government official in Pyongyang could not believe it when the order was received at 5 in the morning that day. In Pyongsung, the revaluation was revealed at a meeting at 9 am. The market price of US dollar had suddenly increased two days before the announcement, but nobody took a notice of it.

Currency Exchange Yet to be Reported
The currency exchange will continue for a week, including three days of instructions on the currency exchange at District Administration Office before the actual process. There has been no report of actual exchange occurring yet. On December 1 and 2, there will be no releasing of new currency, but the Neighborhood Units will collect the old currency from all households. The heads of the Neighborhood Units visit every household instructing them to put 100,000 won of old currency in an envelope with their names and address on it. People are throwing many questions such as "When do we receive the new currency?" "Is it true that we will be paid wages in December?" "There is a rumor saying we won't be able to use US dollars at all, is that true?" but they are not receiving clear answers.

A Direct Hit on Daily Wage Earners

Daily wage earners are the ones showing the strongest reactions. They are having a huge trouble finding food since they cannot buy anything, not even a kernel of corn, until the currency exchange gets completed and the new prices are set. Soonran Kim (alias) in Pyongsung said yesterday (November 30) that there were many absences in school because those who could not earn money were not able to send their children to school.

Attempts to Relinquish Money in Countryside Have Been Blocked
Rich people in Pyongsung are getting caught as they rush to countryside to relinquish their money. Those who try to spend their money to those in need of money in the hopes of saving at least some of it are getting caught at checkpoints and get all the money confiscated. Eunsil Choi (alias) said some wealthy people go to rural areas, where they rarely visit, to relinquish 10,000,000 to 20,000,000 won in haste.

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