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North Korea has executed a currency trader as part of an offensive against currency markets, according to the South Korean spy agency, as Supreme Leader Kim Jong Un tightens his grip on the economy.
Kim Byung-kee, a member of the intelligence committee of the South Korean National Assembly who was briefed by the intelligence service on Friday, said the execution was the latest in a series of “unreasonable” measures by Kim as North Korea fight under the Covid-19 pandemics and international sanctions.
The execution followed a nearly 20 percent appreciation of the North Korean won against the US dollar in recent months, one of the biggest moves in years, according to prices published by Daily NK, a Seoul-based website that tracks sales. market rates in different countries of North Korea. cities. The sudden change highlights the growing instability of the economy, which is worrying Pyongyang.
Analysts said the appreciation of the local currency followed a crackdown on dollar-based transactions as Pyongyang strengthens its grip on the economy after years of market liberalization.
Andrei Lankov, a North Korean expert at Kookmin University in Seoul, said there have been signs of “significant changes” in the currency’s situation since October after years of “remarkable financial stability.”
“For a long time under Kim Jong Un, they did not intervene at all with private companies. . . They not only tolerated, but encouraged decentralization and the shift to market relations between industrial firms and individuals. Now they are trying to back down, ”he said.
Lankov added that the execution would send a warning to the public about acting against the regime’s instructions on the use of foreign exchange. Following the catastrophic and sudden revaluation of Pyongyang’s currency in 2009, foreign currencies have become widely used in border trade and private market transactions, particularly the US dollar and the Chinese renminbi.
There is uncertainty among North Korean observers about the extent of the pandemic in the isolated state. Pyongyang has not publicly confirmed any Covid-19 cases after implementing a swift closure of its borders in January, earlier than most other countries. However, the claim of zero infections has been met with skepticism by international experts and officials.
The crackdown on currency traders and the tightening of control over currency markets comes as Kim struggles with the economic fallout of the pandemic and the subsequent slump in trade with China. These challenges have been compounded by this year’s devastating economic sanctions and devastating typhoons and floods.
Go Myong-hyun, a researcher at the Asan Institute for Political Studies, a Seoul-based think tank, said the shift in focus was a blow to Kim, who had “claimed credit” for economic development since taking power in 2011..
“Between 2010 and 2017, North Korea’s level of imports was increasing, the level of exports was increasing, and [Mr Kim] it was showing important public projects in Pyongyang, ”he said. “Now he can’t do that anymore because he’s running out of money. That is why he is asserting control of the market. “
Go also noted that North Korea’s state media has increased requests for self-sufficiency and the substitution of imports with more products of domestic origin.
“These are essentially expressions that North Koreans have to tighten their belts,” he said.
The Kim regime has long faced criticism for diverting funds from the impoverished public to develop weapons of mass destruction. Last month, Kim presided over the country’s largest military parades in years, introducing the world’s largest mobile ICBM and highlighting its continued focus on developing nuclear weapons despite the worsening economic crisis.
