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North Korean won
The Korean People's won, more commonly known as the North Korean won (symbol: ₩; code: KPW; Korean: 조선 원) and sometimes known as the Democratic People's Republic of Korea won (Korean: 조선민주주의인민공화국 원), is the official currency of North Korea. It is subdivided into 100 chon. The currency is issued by the Central Bank of the Democratic People's Republic of Korea, based in the North Korean capital city of Pyongyang.
Won, like Japanese yen, is borrowed from Chinese yuan, written Hanja 圓 (원), which means "round shape". The won is subdivided into 100 chon (전; 錢; chŏn).
After the division of Korea, North Korea continued using the Korean yen for two years, until the Central Bank of the Democratic People's Republic of Korea was established on 6 December 1947 and the first North Korean won was issued. In February 1959, the second North Korean won was introduced, equal to 100 old won.
From 1978 on, the North Korean government maintained an iconic rate of 2.16 won to the US dollar (which is said to have been based upon Kim Jong Il's birthday, 16 February). Over the decades, however, rampant inflation eroded the currency's value, and from 2001 the government abandoned the rate in favor of those closer to the black market's. A report by defectors from North Korea claimed the black market rate was ₩570 to the Chinese yuan (about ₩4,000 per U.S. dollar) in June 2009.
The third North Korean won was introduced in a revaluation in November 2009, the first in 50 years. North Koreans were given seven days to exchange a maximum of ₩100,000 (worth approximately US$40 on the black market) in ₩1,000 notes for ₩10 notes, but after protests by some of the populace, the limit was raised to ₩150,000 in cash and ₩300,000 in bank savings. The official exchange rate at this time was around $740, but black market value of the ₩150,000 was estimated to be near $30. The revaluation, seen as a move against private market activity, wiped out many North Koreans' savings. The Times speculated that the move may have been an attempt by the North Korean government to control price inflation and destroy the fortunes of local black market money traders. The announcement was made to foreign embassies but not in North Korean state media.
As part of the process, the old notes ceased to be legal tender on 30 November 2009, but notes valued in the new won were not distributed until 7 December 2009. North Koreans were thus unable to exchange any money for goods or services for a week, and most shops, restaurants and transport services were shut down. The only services that remained open were those catering to the political elite and foreigners who both continued to trade exclusively in foreign currency. The measure led to concerns amongst North Korean officials that the move would result in civil unrest. China's Xinhua news agency described North Korean citizens as being in a "collective panic"; army bases were put on alert and there were unconfirmed reports of public protests in the streets in a handful of North Korean cities and towns, forcing authorities to slightly increase the amount of currency people were allowed to exchange. Piles of old bills were also set on fire in separate locations across the country, old paper notes were dumped in a stream (against laws of the desecration of images of Kim Il Sung), and two black market traders were shot dead in the streets of Pyongsong by local police, according to international reports. Authorities threatened "merciless punishment" for any person violating the rules of the currency change.
Pictures of the new notes were published on 4 December 2009 in the Chosun Shinbo, a North Korean newspaper based in Japan. The paper claimed that the measure would weaken the free market and strengthen the country's socialist system. However, the won plummeted 96 percent against the U.S. dollar in the ensuing days after revaluation. Authorities eventually raised the limit to 500,000 won, Chosun reported, and promised no probes into savings of up to one million won, and unlimited withdrawals if savings of more than one million were properly accounted for.
In February 2010, some of the curbs on the free market were eased, and a senior party official was sacked after incidents of unrest. Pak Nam-gi, the director of the Planning and Finance Department of North Korea's ruling Workers' Party, was executed later in 2010. North Korea denied any serious crisis relating to the revaluation.
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North Korean won
The Korean People's won, more commonly known as the North Korean won (symbol: ₩; code: KPW; Korean: 조선 원) and sometimes known as the Democratic People's Republic of Korea won (Korean: 조선민주주의인민공화국 원), is the official currency of North Korea. It is subdivided into 100 chon. The currency is issued by the Central Bank of the Democratic People's Republic of Korea, based in the North Korean capital city of Pyongyang.
Won, like Japanese yen, is borrowed from Chinese yuan, written Hanja 圓 (원), which means "round shape". The won is subdivided into 100 chon (전; 錢; chŏn).
After the division of Korea, North Korea continued using the Korean yen for two years, until the Central Bank of the Democratic People's Republic of Korea was established on 6 December 1947 and the first North Korean won was issued. In February 1959, the second North Korean won was introduced, equal to 100 old won.
From 1978 on, the North Korean government maintained an iconic rate of 2.16 won to the US dollar (which is said to have been based upon Kim Jong Il's birthday, 16 February). Over the decades, however, rampant inflation eroded the currency's value, and from 2001 the government abandoned the rate in favor of those closer to the black market's. A report by defectors from North Korea claimed the black market rate was ₩570 to the Chinese yuan (about ₩4,000 per U.S. dollar) in June 2009.
The third North Korean won was introduced in a revaluation in November 2009, the first in 50 years. North Koreans were given seven days to exchange a maximum of ₩100,000 (worth approximately US$40 on the black market) in ₩1,000 notes for ₩10 notes, but after protests by some of the populace, the limit was raised to ₩150,000 in cash and ₩300,000 in bank savings. The official exchange rate at this time was around $740, but black market value of the ₩150,000 was estimated to be near $30. The revaluation, seen as a move against private market activity, wiped out many North Koreans' savings. The Times speculated that the move may have been an attempt by the North Korean government to control price inflation and destroy the fortunes of local black market money traders. The announcement was made to foreign embassies but not in North Korean state media.
As part of the process, the old notes ceased to be legal tender on 30 November 2009, but notes valued in the new won were not distributed until 7 December 2009. North Koreans were thus unable to exchange any money for goods or services for a week, and most shops, restaurants and transport services were shut down. The only services that remained open were those catering to the political elite and foreigners who both continued to trade exclusively in foreign currency. The measure led to concerns amongst North Korean officials that the move would result in civil unrest. China's Xinhua news agency described North Korean citizens as being in a "collective panic"; army bases were put on alert and there were unconfirmed reports of public protests in the streets in a handful of North Korean cities and towns, forcing authorities to slightly increase the amount of currency people were allowed to exchange. Piles of old bills were also set on fire in separate locations across the country, old paper notes were dumped in a stream (against laws of the desecration of images of Kim Il Sung), and two black market traders were shot dead in the streets of Pyongsong by local police, according to international reports. Authorities threatened "merciless punishment" for any person violating the rules of the currency change.
Pictures of the new notes were published on 4 December 2009 in the Chosun Shinbo, a North Korean newspaper based in Japan. The paper claimed that the measure would weaken the free market and strengthen the country's socialist system. However, the won plummeted 96 percent against the U.S. dollar in the ensuing days after revaluation. Authorities eventually raised the limit to 500,000 won, Chosun reported, and promised no probes into savings of up to one million won, and unlimited withdrawals if savings of more than one million were properly accounted for.
In February 2010, some of the curbs on the free market were eased, and a senior party official was sacked after incidents of unrest. Pak Nam-gi, the director of the Planning and Finance Department of North Korea's ruling Workers' Party, was executed later in 2010. North Korea denied any serious crisis relating to the revaluation.