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2017.06.28
| Won | Pyongyang | Sinuiju | Hyesan |
|---|---|---|---|
| Exchange Rate | 8,070 | 8,050 | 8,095 |
| Rice Price | 5,800 | 6,000 | 5,900 |
Sources inside North Korea have reported that Pyongyang is planning to decree new market prices in the coming days, aiming to bring the market under control at the same time as it moves toward introducing a revised economic management structure.
A North Hamkyung Province source told Daily NK earlier today, “I heard in a people’s unit meeting on the 20th that they will soon declare new state prices for all items. The state price of rice is going to be 4000 won, and corn will be 2000.”
“I was told that items not listed are not going to be saleable, and that a list of precise items and prices is to be put out by the Supreme People’s Assembly within the next few days,” the source went on. “In particular, she said they are going to ban South Korean, American and Japanese products, and strictly crack down on the sale of vehicles.”
The information appears to reflect a desire on the part of the state to retake control of the nation's markets. In recent times, the huge disparity between state and market prices has meant that the state pricing structure has been rendered entirely meaningless, which is what the authorities are presumably hoping to address.
Such moves have been made before. For example, in February 2010, little more than two months after the November 2009 currency redenomination, markets were notified of state prices for around 100 items. As then, the list of prices to be set this time is expected to include things like pork, oil and other core foodstuffs along with light industrial items such as soap.
However, prices in the markets of Sino-North Korean border cities such as Shinuiju and Hyesan are rising uncontrollably these days, suggesting that new state prices such as those claimed by the source will not have any practical value.
Rice and corn were selling in those places for 7000 and 3000 won respectively at the time of writing. As such, the source pointed out, “Market traders can’t be expected to strike 3000 won from the current 7000 won to comply with the regulations. They will just try not to sell it.”
A second source agreed, adding, “They tried to control the market like this a couple of times before, but it never worked. They cannot satisfy supply and demand well enough to maintain a state pricing structure, so obviously controlling the market is impossible right now.”
In the 2010 instance, traders pretended to comply with the newly decreed state prices, but actually continued selling at market prices under the table, thus rendering the price structure meaningless.
The source also revealed that the wages of workers are to rise considerably, saying, “At the same time as introducing the new state prices, they said that workers wages will rise by ten times.”
If the ten-fold rise suggested by the source is correct then formal wages will reach 20,000-30,000 won per month. However, inflation is already rampant in North Korea, making it almost impossible for the state to keep pace and really affect the lives of most people through such wage rises. State wages do not sustain many families in modern North Korea, anyway.
Simply, as the source noted, “All these ideas, including the economic management improvement measures, are making the people more and more anxious. It is true that these state prices plus rising wages will make it possible to buy more food than we can now, but when added to all the market controls, it will cause public anxiety, and that will cause prices to rise again.”
A North Hamkyung Province source told Daily NK earlier today, “I heard in a people’s unit meeting on the 20th that they will soon declare new state prices for all items. The state price of rice is going to be 4000 won, and corn will be 2000.”
“I was told that items not listed are not going to be saleable, and that a list of precise items and prices is to be put out by the Supreme People’s Assembly within the next few days,” the source went on. “In particular, she said they are going to ban South Korean, American and Japanese products, and strictly crack down on the sale of vehicles.”
The information appears to reflect a desire on the part of the state to retake control of the nation's markets. In recent times, the huge disparity between state and market prices has meant that the state pricing structure has been rendered entirely meaningless, which is what the authorities are presumably hoping to address.
Such moves have been made before. For example, in February 2010, little more than two months after the November 2009 currency redenomination, markets were notified of state prices for around 100 items. As then, the list of prices to be set this time is expected to include things like pork, oil and other core foodstuffs along with light industrial items such as soap.
However, prices in the markets of Sino-North Korean border cities such as Shinuiju and Hyesan are rising uncontrollably these days, suggesting that new state prices such as those claimed by the source will not have any practical value.
Rice and corn were selling in those places for 7000 and 3000 won respectively at the time of writing. As such, the source pointed out, “Market traders can’t be expected to strike 3000 won from the current 7000 won to comply with the regulations. They will just try not to sell it.”
A second source agreed, adding, “They tried to control the market like this a couple of times before, but it never worked. They cannot satisfy supply and demand well enough to maintain a state pricing structure, so obviously controlling the market is impossible right now.”
In the 2010 instance, traders pretended to comply with the newly decreed state prices, but actually continued selling at market prices under the table, thus rendering the price structure meaningless.
The source also revealed that the wages of workers are to rise considerably, saying, “At the same time as introducing the new state prices, they said that workers wages will rise by ten times.”
If the ten-fold rise suggested by the source is correct then formal wages will reach 20,000-30,000 won per month. However, inflation is already rampant in North Korea, making it almost impossible for the state to keep pace and really affect the lives of most people through such wage rises. State wages do not sustain many families in modern North Korea, anyway.
Simply, as the source noted, “All these ideas, including the economic management improvement measures, are making the people more and more anxious. It is true that these state prices plus rising wages will make it possible to buy more food than we can now, but when added to all the market controls, it will cause public anxiety, and that will cause prices to rise again.”
