Remember that famous picture of North and South Korea at night?
The darkness that is North Korea has, if it's possible, gotten darker. From the Times Online:
In the capital, Pyongyang, yesterday only the few shops and restaurants permitted to trade in foreign currencies — patronised by the privileged elite and the city’s small foreign population — were open for business. All other enterprises and services based on cash, including markets, long-distance bus services, barbers’ shops, saunas and bath houses, were suspended until the revaluation of the won is completed next week.
There were reports of public outrage and confusion after the announcement of the measure, which requires North Koreans to swap existing won notes for new ones at an exchange rate of one to 100 — effectively knocking two zeroes off their value. Because of a cap of 100,000 won per family (£475 at the official exchange rate), anyone with significant holdings of cash will have their savings wiped out.
Meanwhile, ABC news reports:
One South Korean report says graffiti and leaflets criticising dictator Kim Jong-Il have surfaced.
In a bid to dissuade mass defections sparked by the revaluation, North Korean troops have been ordered to shoot to kill anyone trying to cross the border into China.
The Economist cautions at the use of the word "revalue" suggesting, instead, the term "confiscate."
WESTERN reports decribe North Korea's currency moves as a "revaluation". The word is pure Newspeak. When a government revalues its currency, citizens do not rush out to convert their cash into foreign notes, as North Koreans have done this week. Nor do they stand on the streets screaming at officials in anger and despair.
Rather, the moves represent confiscation on a massive scale. By this coming Sunday, the state says, all existing currency must be replaced by a brand new won, with old 10,000 won bills swapped for new 10 won bills. So far so fine. The state wants to fight inflation, and plenty of other countries have resorted to the expedient of a new currency.
But the state also wants to crack down further on North Korea's myriad private markets. The currency moves are all of a piece, for the maximum amount of old currency that may be converted into new is 100,000 won. For rich traders doing business with China, this matters little. Their wealth will already be in Chinese yuan or dollars. Ditto for the elite. For North Korea's poorest, the new currency is also neither here nor there, for they have no cash at all. But for the broad middle struggling to cope, this is a disaster. Responding to popular fury, North Korea appears to have raised the limit this week to 150,000 won.
Claudia Rosett and Daniel Drezner both comment (HT to Glenn Reynolds). For those of us living in societies that are more or less free economically, it's a stark reminder of home inhumane men can be to one-another.