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Dec. 2 – North Korea has abruptly revalued its currency by a huge margin and restricted the amount of old money people can exchange for new bills prompting reports of rioting in its capital, Pyongyang.
The measures are intended to stomp out burgeoning black market trading by effectively wiping two zeroes off the value of North Korea’s currency, the won. The hermit state moved further to choke illegal currency trading by only allowing about 100,000 to 150,000 old won to be exchanged for the new notes. The new rules sent people desperate to exchange their won for the U.S. dollar and Chinese renminbi even at lower black market rates.
According to Daily NK, a dedicated North Korean online news site, the maximum amount per household which could be exchanged in cash was changed to 150,000 won but a new decree now states that authorities will only permit people to exchange the rest of the money at 1,000:1 although the exchange rate is still 100:1.
North Koreans who kept cash on hand to help them survive lean months effectively saw their savings massively diminished. “As people rushed to swap money, commercial activities have virtually come to a standstill.” Good Neighbors, a Seoul-based relief agency, said in a statement. “The purpose of the reform is to kill private market activities that stoked anti-socialism.”
