Residents of North Korea are increasingly using foreign currency to conduct daily business as the won suffers stability issues following a new round of international sanctions against Pyongyang, according to sources inside the country.
When asked about the cost of goods in North Korea, residents told that prices are increasingly referred to in Chinese yuan near the border with China or in U.S. dollars in the capital and in the country’s interior provinces.
“[Rice] costs 5 yuan (U.S. $0.80) per kilogram (2.2 pounds), ” a resident of Yanggang province who had recently crossed the border to visit China said about the price of the North Korean diet staple.
North Korea Won Bank Note. North Korea Won Is The National Currency Of North Korea Stock Photo
When pressed to reveal the cost in North Korean won, the source had to calculate his answer using the black market exchange rate.
The source said that he was having trouble providing an accurate exchange rate because he had left North Korea several days earlier and the value of the North Korean won had fluctuated wildly since.
But he added that it was becoming increasingly rare for people to buy goods in the northern region of North Korea without using Chinese currency.
What Is The Currency Of North And South Korea?
Asked about the cost of rice, North Koreans who live in the capital responded, “One kilogram of rice costs almost U.S. $1” or, “If you have U.S. $1, you can buy slightly more than a kilogram of rice.”
They said that the dollar, which buys around 7, 000 won on the black market, is also a common form of payment in North Korea’s interior provinces.
A resident of the Sinuiju Special Administrative Region, along the border with China in North Pyongan province, said that North Korean won had become virtually unusable in the reclusive and impoverished country.
North Korea Banknote
“Trust in the North Korean currency is getting worse among residents, and the won is losing its value as a general means of payment. It’s impossible to rectify this situation, ” the source said.
Earlier this month, the U.N. Security Council ordered tighter restrictions on North Korea's financial activities as part of stiff sanctions for conducting its third illicit nuclear test in February.
The sanctions require states to block any financial transaction that could contribute to North Korea's illicit weapons programs and to prohibit the opening of North Korean bank branches on their territories if there is a link to the violation of Security Council resolutions.
All You Need To Know About Korean Currency
They also call on states to prohibit their financial institutions from opening offices in North Korea. The sanctions apply to bulk cash transfers, including through cash couriers, a common way that North Korea has moved illicit funds.
The move further strains the already embattled economy of North Korea, which faces chronic food shortages and relies on foreign aid to feed its people.
But the cost of rice still makes up a significant portion of the average worker’s wages, which for a government worker are officially about 2, 000 to 6, 000 North Korean won (U.S. $0.70 to $2 based on market rates) per month.
Fun Facts About The South Korean Won
In December, the price of rice had risen to about 6, 000 North Korean won per kilogram without dropping as it usually does at the end of the harvest season, according to sources in the country.
An economic analyst in China said that articles written in other countries, such as South Korea, about North Korea’s economy often have wildly differing exchange rates listed for the North Korean won.
“If you want to report correctly about the North Korean economy, you’re better off using the Chinese yuan and U.S. dollar as a standard—it’s the safest way.”
South Korea's Won
North Korea officially issued a revalued won in December 2009, replacing 1, 000-won notes with 10-won notes but strictly limiting the amount of old currency that can be exchanged.
The move sent shock waves through North Korea, with reports of citizens rushing to black-market moneychangers to cash in their won for more stable U.S. dollars and Chinese yuan.
North Korean citizens were threatened with merciless punishment for defiance of the new currency rules and were told they had only a week to exchange a maximum of 100, 000 won per person of the old currency for new bills.During your visit to North Korea, you’ll need to pay for incidentals such as souvenirs, extra snacks or drinks, laundry or international phone calls. What currency does North Korea use and how do you pay?
Did Japanese Yen And Korean Won Always Have So Many Digits? Isn't That Supposed To Be A Sign That Their Economy Is Not Doing Well? Then, Why Are They Developed Countries?
North Korea’s currency is the North Korean Won, otherwise known as the Korean People’s Won (KPW) and was introduced as the national currency in 1947 to replace its predecessor, the Korean Yen. The Korean Yen circulated for several decades during the Japanese occupation prior to North Korea’s founding. A revaluation of the North Korean Won occurred in 2009, which circulated the current issue polymer infused banknotes.
Yes and no. Technically, it’s not permitted for tourists to use the North Korean Won and typically you won’t handle or use local currency during your visit to North Korea. However, there are exceptions and on most of our group tours, we visit the Kwangbok Department Store in Pyongyang where you’ll have the opportunity to exchange into North Korean Won and make purchases within the store.
There are just two places in Pyongyang where tourists are permitted to exchange and use the local North Korean Won: Kwangbok Department Store and Daesong Department Store. These multi-story shopping complexes include a grocery store, clothing and apparel, electronics and whitegoods departments and a food court. They’re always buzzing with Pyongyang’s residents stocking up on the assorted local and imported product. Money exchange counters are available inside to buy and sell the Chinese Renminbi (RMB), United States Dollar (USD) and the Euro (EUR) against the local North Korean Won (KPW) at market exchange rates.
South And North Korea Banknotes, Won Stock Photo, Picture And Royalty Free Image. Image 51354054
If you’re visiting the Rason Special Economic Zone in the remote northeast, North Korean Won can be acquired at the Golden Triangle Bank in Rajin, along with pre-loaded debit cards for use within Rason. North Korean Won can be spent at Rajin Market, the only free market accessible to tourists in North Korea, where you can engage in trade with the locals for anything but hen’s teeth!
North Korean Won is a closed currency and unfortunately, we must advise that North Korea does not permit it to be taken out of the country. However, it’s possible to purchase souvenir collections of the previous issue currency which includes full sets of uncirculated banknotes and coins.
Foreign currency in cash will be your primary means of payment for souvenirs, optional entry fees and daily purchases during your visit to North Korea. The Chinese Renminbi (RMB), United States Dollar (USD) and Euro (EUR) are widely accepted and interchangeable, with cashiers doing the conversion when required. Each currency has its advantages and disadvantages, for convenience it’s best to bring a variety of each in low denomination notes.
North Korean Won To Inr
The Chinese Renminbi (RMB) is the most flexible currency for tourists as the banknote denominations are small (max 100 RMB) and change is plentiful due in part to the high volume of Chinese tourists visiting North Korea. RMB is conveniently accessible as you’ll be passing through China en route to North Korea in most cases. If you’re traveling to a border zone in North Korea such as Sinuiju or Rason, RMB may be the only readily accepted foreign currency.
The Euro (EUR) is North Korea’s ‘default’ foreign currency and is the ideal currency for souvenir purchases and optional entry fees such as performance tickets. Most souvenirs are ticketed in EUR and although they can always be converted into RMB or USD, it’s best to pay in the ticketed currency for the best rate. No conversion will be required when paying entry fees with EUR, and prices typically reflect an exact banknote, 5 EUR or 20 EUR for example. EUR isn’t convenient for small purchases as the lowest note denomination is 5 EUR, however, 1 and 2 EUR coins can fill this void.
The United States Dollar (USD) is especially useful for incidentals such as snacks, drinks and small souvenirs such as postcards, stamps, newspapers or pins. If possible, we recommend bringing a stack of 1 USD bills, however, the major problem with USD is ripped, worn or marked notes. Damaged bills won’t be accepted and this is exceptionally strict with USD. Additionally, notes need to be of recent issue.
North Korean Currency: North Korean Money And How To Get Your Own North Korean Won
Importantly, don’t bring large notes (50/100 USD or EUR) as they’ll be difficult, if not impossible to break. Even for small purchases, you’ll often receive a mixture of currencies in change and if they’re out, perhaps some bubble gum, water or a stamp to make up the weight!
For foreigners, North Korea is entirely a cash economy. Foreign credit cards are not accepted and there are no ATMs for you to withdraw money. You cannot send money to North Korea, traveler’s cheques are not accepted and no online payment options are available. This means that all spending money must be carried with you into the country. We strongly recommend all travelers to bring more cash than they anticipate to spend as if you run out there are truly no options, you’ll be borrowing from fellow travelers!
While payment options within North Korea are limited, the options for booking your
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