As exchange rates in North Korea soar with the restart of China-North Korea freight train service after a two-year hiatus, a source says there are signs that North Koreans with foreign currencies welcome development.
A source from Yanggang province told Daily NK on Tuesday that some residents of Hyesan are happy with the higher exchange rates as they can now buy five kilograms more rice with 100 RMB.
As late as January 11, the yuan was trading at 600 KPW, while the dollar was trading between 4,000 and 5,000 KPW. Since around January 20, however, rates have soared, with the yuan hitting 850 KPW and the dollar 6,400 KPW.
Demand for foreign currency has increased due to the restart of the China-North Korea freight train service last month and recent widespread talk of so-called “state-run smuggling” in the province’s border regions. from Yanggang.
While exchange rates soared on expectations of revived trade, food prices fluctuated little, remaining around 5,000 KPW for one kilogram of rice.
Last month, 100 RMB could buy you 12 kilograms of rice, but now you can buy 17 kilograms.
Similarly, 100 RMB might get you 1.76 kilograms of cooking oil last month, but now it gets you 2.56 kilograms. So, locals with foreign currencies naturally welcome the rising rates, the source said.
On the other hand, many people apparently try to hold on to their foreign currency without spending it. This category of people paid for their food using the local currency, as before.
The source said there was even speculation that the exchange rate would rise further based on rumors that trade would soon return to normal. He added that more and more people are waiting, thinking that now is not the time to part with their foreign currency.
Please direct any comments or questions regarding this article to [email protected]
read in korean