North Korea on guard for outbreaks of ‘civil unrest’ after currency revaluation

Reports from China say  the withdrawal and replacement of old North Korean currency and the release of redenominated bills beginning November 30 has triggered widespread confusion in the communist state.

The Daily NK, a South Korean-based newspaper with sources inside North Korea, reported from Changchun, China that the Ministry of People’s Security (MPS) was ordered to control residents. The State Security Department (SSD), Defense Security Command of the People’s Army and army bases were all placed on alert as a result of the currency issue.

According to the report, the exchange rate for old and new bills is 100 to1, and the ceiling for any given household was 100,000 of the old currency, or 1,000 Won in new denominations. On Sunday, December 13, 2009 one U. S. dollar was worth 135,000 Won

Any amount in excess of 100,000 Won cannot be traded in, making the savings of traders and middle-class workers valueless.

After the decree on the currency was issued, MPS and community guards began monitoring residents more closely and military bases were placed on alert to cope with possible unrest.

A 10 p.m. curfew was also imposed with a warning that offenders would be dealt with harshly.

One North Korean source was quoted as saying: “With 100,000 Won, we can now buy just half a kilogram of rice. Property we have sweated blood for has turned to nothing.”

North Korean rice prices have more than doubled since the government revalued the currency, a South Korean aid group said. One kilogram (2.2 pounds) of rice cost 50 Won starting December 5, compared with 16 to 17 Won previously, said the Buddhist aid group Good Friends, which obtains information through contacts in North Korea.

One out of four school children were absent due to hunger, indicating how widespread the struggle to find food had become, the group said.

One couple in the their 60s committed suicide after the currency decree was issued, a source said, adding that State Security forces are “extremely tense and concerned about the situation expanding into civil unrest.”

Authorities also warned North Koreans not to damage old bills, reminding them that “spoiling money on which Great Leader’s portrait is printed is treated as treason.”

A source from Shinuiju said: “Loud sounds of weeping in every house have not ceased since the news was released. Weeping and fighting between couples has not stopped anywhere. The atmosphere of the city is terrible now.”

He added, “This currency reform is a horrifying trick. It is the first time people have cried on the streets since the Great Leader’s death,” referring to the death of Kim Il-Sung in 1994.

The latest signal of North Korea’s economic collapse could result in more willingness by its communist dictators to cooperate with the West but some fear it could turn into coveting its South Korean neighbor and even military conflict. It is tense.

Based on reports by East-Asia-Intel.com, December 11, 2009