A source from Pyongyang has reported that the authorities
are currently attempting to enforce an order handed down earlier this year that
called upon residents to exchange hard currency for local Korean People’s Won.
“They are trying to strengthen the order they handed down in
January telling us to exchange our foreign currency for local money,” the
source from the North Korean capital told Daily NK on the 28th. “These types of
foreign currency regulations normally disappear silently in a month or two, so
people, most of whom had ignored it this time as well and kept their foreign
currency, are feeling pretty uncomfortable right now.”
“They keep telling us
in People’s Unit meetings that if we hide foreign currency we will be harshly
punished,” the source said. “So the number of people actually thinking of doing
what they want seems to be rising. The situation is a bit different to before;
the MPS (Ministry of Public Security) is focusing on the donjuLiterally "masters of money," donju refers to people who hav... More, and agents have searched some of their homes. Even the donjuLiterally "masters of money," donju refers to people who hav... More are fearful, then, and some money
seems to be changing hands.”
The source alleged that the policy could be part of the
reason why black market exchange rates for USD and RMB are declining.
Currently, the black market price of $1 in Pyongyang, Sinuiju in North Pyongan
Province, and Hyesan in Yankang Province is 7300, 7500, and 7550 won, a decline
of 1100, 800, and 750 won respectively since last month.
Current policy fits into the broader frame of Kim Jong
Eun-era attempts to secure access to reserves of foreign currency in domestic society.
For instance, in 2012 the authorities began to trump black market exchange
rates to encourage people to trade in hard currency; however, that policy was
wound down after just two months.
However, the authorities are not seeking to enforce a
prohibition on use of foreign currency in public markets. As Daily NK recently
reported, even small change is now being given in foreign currency in some
regions.
