North Korean Money: A Fascinating Look at the World's Most Secretive Currency

Introduction to North Korean Currency 🇰🇵

North Korea, officially known as the Democratic People's Republic of Korea (DPRK), remains one of the world's most isolated and mysterious nations. Among the many enigmatic aspects of this secretive state is its currency system. The North Korean won (₩) serves as the official currency, yet it operates under economic principles vastly different from those found in most countries around the globe.

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The History of North Korean Money 📜

Origins and Early Development

The North Korean won was first introduced in 1947, shortly after the country's division following World War II. Initially, it replaced the Korean yen at par. The currency has gone through several iterations and reforms since its introduction, each reflecting the nation's political and economic transformations.

In 1959, the first major currency reform took place, with new banknotes being issued. This was followed by additional reforms in 1979, 1992, 2009, and most recently in 2021. Each of these reforms has had significant implications for the North Korean people and economy.

The Devastating 2009 Currency Reform

Perhaps the most notorious currency event in North Korea's recent history was the 2009 currency redenomination. In November of that year, the government suddenly announced that old won notes would be exchanged for new ones at a rate of 100:1, with strict limits on how much could be converted.

This dramatic move effectively wiped out many citizens' savings and triggered widespread panic and unrest. The reform was later acknowledged as a failure even by North Korean authorities, a rare admission that underscores how disastrous the policy had been.

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Characteristics of North Korean Banknotes and Coins 💰

Current Denominations

Today's North Korean won comes in both coins and banknotes:

Coins: 1, 5, 10, 50 chon and 1 won Banknotes: 5, 10, 50, 100, 200, 500, 1,000, 2,000, and 5,000 won

Design Elements

North Korean currency is notable for its distinctive design elements, which heavily feature political imagery and revolutionary themes:

1. Political Figures: Most prominently, the late leaders Kim Il-sung and Kim Jong-il appear on various denominations. The founder Kim Il-sung is featured on the 100, 1,000, and 5,000 won notes.

2. Landmarks and Monuments: Key North Korean landmarks such as the Juche Tower, Mount Paektu, and various revolutionary monuments are depicted.

3. Ideological Symbols: Communist and revolutionary symbols are abundant, including the red star, national flag, and emblems representing self-reliance.

The artistic style employed in North Korean banknotes reflects socialist realism, with bold colors and heroic imagery designed to reinforce state ideology. The technical quality of the printing has improved over time, particularly with more recent issues incorporating modern anti-counterfeiting measures.

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The Dual Currency System 🔄

One of the most fascinating aspects of North Korea's monetary system is its dual nature. The country effectively operates with two parallel currency systems:

The Official Won

The official North Korean won is the currency used by most citizens for everyday transactions within the domestic economy. It's what workers receive as wages and what most people use to purchase goods from state-run shops and local markets.

Foreign Currency Economy

Alongside the official won, there exists a parallel economy based on foreign currencies, primarily:

• Chinese yuan
• US dollars
• Euros

These foreign currencies are used in specialized shops (often called "foreign currency shops"), in the tourism industry, and for any international trade. They're highly prized by North Koreans as they retain value and provide access to higher-quality imported goods.

This dual system creates significant economic disparities within North Korean society. Those with access to foreign currency—such as officials, those working in tourism, or individuals receiving remittances from relatives abroad—enjoy substantially greater purchasing power and access to better goods and services.

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The Value of North Korean Money 📉

Exchange Rates

The official exchange rate set by the North Korean government differs dramatically from the market rate. This discrepancy exemplifies the disconnect between official economic policy and reality.

Official Rate (approximate): 100 won = 1 USD Market Rate (approximate): 8,000-10,000 won = 1 USD

This enormous gap—with the market rate valuing the won at less than 1% of the official rate—illustrates the currency's weakness and the lack of international confidence in North Korea's economy.

Purchasing Power

Understanding what the North Korean won can actually buy provides insight into the country's economic reality:

• A kilogram of rice: Approximately 5,000-8,000 won
• A simple meal in a basic restaurant: 5,000-10,000 won
• A domestically produced shirt: 15,000-30,000 won
• Monthly salary for an average worker: 2,000-4,000 won (official sector)

These numbers highlight the stark disconnect between wages and prices, forcing many North Koreans to participate in informal market activities to supplement their official incomes.

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Currency Control and Restrictions 🚫

The North Korean government maintains strict control over its currency and financial system:

Restrictions on Foreign Currency

While the use of foreign currencies has been tacitly accepted in certain contexts, the government periodically cracks down on their use. Laws officially prohibit ordinary citizens from possessing foreign currency, though enforcement varies.

Limited Convertibility

The North Korean won is a non-convertible currency, meaning it cannot be legally exchanged outside North Korea. This lack of convertibility isolates the North Korean economy and makes international trade exceptionally challenging.

Travel Restrictions

Visitors to North Korea face strict currency regulations:

• They're typically required to use foreign currency (EUR, USD, or CNY)
• Any won obtained must be spent before leaving the country
• Taking North Korean currency out of the country is prohibited

Collecting North Korean Currency 🧐

For numismatists (coin and banknote collectors), North Korean currency represents a particularly challenging but fascinating collecting area:

Legality Concerns

In many countries, sanctions against North Korea might affect the legality of trading its currency. Collectors should thoroughly research applicable laws in their jurisdiction.

Authenticity Issues

Due to the rarity and isolation of North Korean currency, counterfeits exist in the collector market. Experienced collectors recommend purchasing only from reputable dealers with proven expertise in Asian currencies.

Commemorative Issues

North Korea periodically issues commemorative banknotes and coins celebrating significant national events or anniversaries. These special issues often feature unique designs and can be particularly valuable to collectors.

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The Future of North Korean Money 🔮

Predicting the future of North Korean currency involves understanding the complex forces shaping the country's economic trajectory:

Digital Possibilities

There have been reports that North Korea is exploring digital currency options, potentially as a way to evade international sanctions. Though details remain scarce, this would represent a significant shift in how the regime manages its financial system.

Reform Potential

Economic reforms, similar to those implemented in China or Vietnam, could potentially lead to currency stabilization. Minor market-oriented reforms have occurred in recent years, but their impact on currency value has been limited.

Unification Scenarios

Any potential reunification with South Korea would likely lead to a complex currency integration process. Lessons from German reunification suggest this would be one of the most challenging aspects of bringing the two economies together.

Conclusion: The Currency of the "Hermit Kingdom" 🏯

North Korean money tells a fascinating story of a unique economic system that operates unlike any other in the world. The currency reflects the country's isolation, its ideological foundations, and the complex realities of life in this secretive state.

For economists, historians, and curious minds alike, studying North Korean currency offers a window into understanding how money functions in a controlled economy and the creative ways people adapt to economic challenges.

Whether you're a serious collector, a student of international economics, or simply curious about this enigmatic country, North Korean money represents one of the world's most distinctive and compelling currency stories.

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Disclaimer: This article is for informational purposes only. The author and publisher do not endorse or encourage any activities that may violate international sanctions or laws regarding North Korea. Always consult relevant authorities and legal counsel regarding the legality of collecting or possessing North Korean currency in your jurisdiction.