Business

North Korea’s ‘wild’ forex volatility signals new risks for Kim Jong Un أو


North Korea has been hit by sharp fluctuations in currency and food prices as economic pressures from the COVID-19 pandemic and international sanctions create new risks for Kim Jong Un.

The volatility is set to exacerbate the plight of many of North Korea’s 25 million residents. It can also lead to the dismantling of the country’s informal market trading system, known as Gangmadang, and increases instability.

The North Korean won has appreciated by about 30 percent against the US dollar and 40 percent against the Chinese renminbi since the beginning of the pandemic, according to Daily NK, a website that tracks North Korean markets.

There is real price inflation in the market now, which is very scary. “At the same time, fuel prices have inflated very dramatically, and foreign exchange rates – the dollar and the renminbi against the won – have collapsed,” said Peter Ward, an expert on North Korea at the University of Vienna.

Pyongyang has mostly isolate the country From foreign trade and aid since the beginning of the coronavirus crisis, fearing the impact of uncontrolled virus transmission. Hurricane damage worsened last year Economic pressure.

Experts returned the coin and foreign exchange movements To the combination of collapsing trade and efforts by the state to remove foreign currency from domestic circulation.

William Brown, a former US intelligence officer who leads a consulting firm in Northeast Asia for Economics and Intelligence, said monetary stabilization was a The hallmark of Kim’s rule. This boosted market development after periods of inflation and currency depreciation under his father Kim Jong Il.

“Wild volatility” has risked raising the level of popular despair in the country, Brown Wrote for 38 North, a program run by the Stimson Center, an American think-tank. “At some point, even now, inflation may be seen as a greater enemy to stability . . . than the United States.”

Jo Myung-hyun, an expert on North Korean economics at the Asan Institute for Political Studies, a Seoul-based think tank, noted that Kim has ordered the country to reduce its reliance on import “disease”, in line with recent moves to centralize control of the economy and Pressure on the country’s elite.

The North Korean regime will avoid a repeat of the famine of the 1990s, and the bigger story here is the North Korean regime’s efforts to suppress the market system. . . To me, it’s pretty obvious that she’s going to follow Gangmadang,” He said.

Kim’s system also transforms into pirate army To raise funds, experts said.

Yana Blackman, a former Israeli intelligence agent working for cybersecurity group Venafi, said cybercrime proceeds should be viewed as a primary means of revenue generation. North Korean cybercriminals have made billions of dollars in recent years by… Wide range of charts It targets banks and other associated financial institutions, including peer-to-peer lenders and cryptocurrency exchanges.

“There are many unreported attacks, especially in terms of more small unnoticed attacks like ransomware and cryptocurrency,” she said.

The economic problems are deeply felt by North Koreans, and many of them are already suffering Food insecurityAccording to the defectors who keep in touch with contacts in the country.

Kang Chul-hwan, a defector based in Seoul, said the prices of food and basic commodities have risen three to ten times.

“It seems that Kim’s regime is slowly being paralyzed,” he said.

Seo Jae-pyeong, another fugitive, said levels of food aid from China appeared to be declining, despite earlier indications of this. Increasing shipments.

“The question of how many meals people eat is not the right question,” Seo said. “The question should be whether the soup is thin or thick.”



Source link

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button