N. Korea ‘Allows Private Markets to Reopen’ After Currency Chaos

Jakarta Globe, February 18, 2010

North Korean farm workers weed a rice paddy in Unpha county, in North Korea's North Hwanghae province. (AFP Photo)

Seoul. North Korea has allowed private markets to reopen nationwide after a bungled currency revaluation worsened food shortages and fueled anger at the regime, a Seoul welfare group said on Thursday.

“All the markets across the country should be reopened — without exceptions — as before,” Good Friends said in a newsletter, citing what it said was a special order from the central committee of the ruling Workers’ Party. It said security organizations across the nation were ordered to launch “absolutely no crackdowns on trading in food” at the markets.

South Korea’s intelligence agency said this month that the curbs on private markets had been eased in various places.

The official policy turnaround came last week, “based on assessments that the currency reform has caused enormous pain to people by paralyzing distribution networks,” group director Lee Seung-yong said.

“I believe North Korea will not clamp down on market activities for a considerable period, or at least until its state distribution system is back to normal.”

The South’s Ministry of Unification, which handles cross-border relations, could not confirm the welfare group’s report.

“We’ve heard the North is gradually easing curbs on the markets but it is difficult to verify the full-scale reopening,” spokeswoman Lee Jong-joo said.

In recent years the Pyongyang regime has imposed a series of curbs on market traders in an attempt to regain control over the economy, even though the official food-rationing system was largely inoperative.

A currency revaluation announced on November 30, involving a 100-for-one swap of old won banknotes for new currency, was part of the crackdown on private traders. But it sparked widespread anger by wiping out savings, sent prices soaring and worsened already serious food shortages, according to numerous reports.

Good Friends said this week that about 2,000 people had starved to death across the nation this winter. Analysts told a parliamentary seminar in Seoul that the currency chaos was a blow to the regime itself.

“The failure in North Korea’s currency revaluation brought about severe damage to the endurance of the North Korean system,” said Baek Seung-joo, of the Korea Institute for Defense Analyses.

Agence France-Presse