Tuesday, January 03, 2012

Ask a Korean! News: North Korea Bans the Use of Foreign Currency

Apparently, the first order of business in post-Kim Jong-Il North Korea is to ban the use of foreign currency in markets, such as American dollar or Chinese renminbi, with a potential death penalty against those who violate the order. The order came down on Dec. 30 of last year. This move signifies that Kim Jong-Un is willing to keep trying to revert to a communistic, controlled economy, although the last attempt at reverting to a controlled economy -- the currency reform (apparently done at Kim Jong-Un's initiative also) -- was a miserable failure.

There is no reason to believe that this measure will have a different fate. Some North Korean watchers go so far as to say that this order can't be actually implemented, because it is practically impossible to stop the use of foreign currency in North Korean market. At the wholesale level, virtually all transactions are done in either dollars or yuan. If the regime does try to enforce this order, North Korean commerce (what little there is) would be completely paralyzed.

The more Kim Jong-Un tries to strengthen his grip over his country, the more quickly it will slip away. The total loss of control won't be long.

Got a question or a comment for the Korean? Email away at askakorean@gmail.com.

5 comments:

  1. "The more Kim Jong-Un tries to strengthen his grip over his country, the more quickly it will slip away. The total loss of control won't be long."

    Andrei Lankov says essentially the same thing here: http://keia.podbean.com/2011/09/26/andrei-lankov-kookmin-university/

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  2. I heard B.R. Myers on a radio interview recently. Find it here:

    http://www.scpr.org/programs/patt-morrison/2011/12/27/21899/north-korea-allegations-of-fake-mourning-and-self-

    His idea of the biggest threat to the regime is something like this.

    "The biggest risk to the regime is that the North Korean public is growing increasingly aware that the South Koreans basically just don't care about the North. The regime has convinced through propaganda that the North needs to sacrifice and lead difficult, poor lives so they can one day kick the Yankees out of the South and reunify.

    But here's the problem. The South doesn't actually hate America. The South doesn't want to live under the North Korean leader (whoever it is). The South really just has no interest in reunification and is scared of the costs. And the North Korean public is very slowly realizing this."

    How convincing does the Korean find this argument? Is North Korea a subject that most Southerners are not particularly interested in? Whats your take on this argument?

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  3. Is North Korea a subject that most Southerners are not particularly interested in?

    I like Prof. Myers, but in this case I think he overstates his case a little. A lot of people have this mistaken view that because North Korea is so dangerous, South Koreans must think about North Korea constantly, right up there with the concern about what to have for dinner. Coming from that perspective, it could appear that South Koreans don't really care about North Korea.

    To be sure, there is a small (but growing) group of South Koreans who do not care all that much about NK. But overall, South Koreans care about reunification to a significant degree. To give a reference point, South Koreans care much more about reunification than Americans care about gay rights or global warming.

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  4. Interesting. Thanks for the reply.

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  5. I further vouch for The Korean's statement since I am currently living in Korea...specifically Jeju-do. Because I have talked to many Koreans both from Jeju and from Seoul, and most want a reunification...even the high school students that I teach want a reunification. (Which I thought was rather odd giving that Jeju is somewhat autonomous)

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