As of early January, prices of most items in the North Korean market appeared to have doubled compared to the same period last year. The North Korean won-dollar exchange rate has risen nearly three times compared to a year ago, and residents’ reactions to this are understood to vary greatly depending on income level.
According to Daily NK’s regular survey of North Korean market prices, the North Korean won-dollar exchange rate in Pyongyang was traded at 22,100 won as of the 5th. The North Korean won-dollar exchange rate, which was around 18,000 won in early November last year, jumped to the 20,000 won range in December and continues to show a downward trend even into the new year.
As of the 5th, the won-dollar exchange rates in major North Korean city markets, such as Sinuiju in North Pyongan Province and Hyesan in Yanggang Province, were found to be similar to those in Pyongyang.
As of early January last year, the won-dollar exchange rate in Pyongyang was 8,300 won, and compared to this, the current dollar exchange rate has increased by 166.3%. In past North Korean market price data, this is the first time since the currency reform in 2009 that the exchange rate has risen so sharply in one year.
The North Korean won-yuan exchange rate also soared more than twice compared to January last year, but the increase was found to be somewhat lower than that of the dollar. On the 5th, the North Korean won-yuan exchange rate in Pyongyang was 3,200 won, slightly higher than the price on the 22nd of last month, which was 3,150 won. Compared to the yuan exchange rate of 1,250 won in January last year, the current price is 156% higher.
As foreign currency exchange rates soar, the prices of imported goods in the North Korean market have also nearly doubled. As of the 5th, in a market in Pyongyang, the prices of gasoline and diesel were traded at 24,400 won and 21,300 won per kg, respectively. It is up 92.1% and 88.5% from the prices of 12,700 won and 11,300 won a year ago.
The prices of cooking oil and sugar, which are representative imported foods, were also found to have increased by 85% and 97.9%, respectively, compared to the prices surveyed in January last year.
Among imported goods, the only item that has maintained its current price level without a significant price increase is flour. In the case of flour, the demand from the general public is not high, and there is limited import, distribution, and sales through national trading companies, so the price fluctuations do not appear to be significant so far.
However, the current pork price is 31,200 won per kilogram, an increase of 108% compared to the same period last year. This is believed to be due to a decrease in the number of livestock due to African swine fever rather than a rise in exchange rates.
Meanwhile, the price of food, a key market item in understanding the economic situation of North Korean residents, was found to have a somewhat lower rate of increase compared to imported goods. On the 5th, at a market in Pyongyang, 1kg of rice was priced at 8,500 won, a 76% increase in one year compared to the price in early January last year (4,820 won).
The rate of increase in corn prices was higher than that of rice. On the 5th, 1 kg of corn (corn) in a market in Pyongyang was 4,200 won, an 86% increase from the price in early January last year (2,260 won).
As such, residents’ reactions to the fact that prices in the North Korean market have nearly doubled in one year are mixed. The economically poor, who are employed but have a low rank and do not earn much in the market, feel threatened by this rise in prices.
Multiple internal sources say that not only are people changing their staple food from rice to corn, but they are also barely making ends meet by reducing the amount of food they eat, and the number of frugal generations is increasing, especially in rural areas.
However, it is known that relatively high-ranking executive level residents who belong to large enterprises, schools, or party organizations are not greatly affected by such price increases. This is also consistent with the situation in which North Korean authorities significantly increased nominal wages at institutions and enterprises last year.
On the 10th, a source from Daily NK in Pyongyang said, “People who have some money or are executives who trade on a large scale do not seem to feel the difficulties of rising prices directly because their salaries increased more than 10 times last year.” “In fact, some say that the price of rice has become lower (cheaper) due to national policies.”
As the income gap between residents who belong to large institutions and enterprises and those who do not, or between executives and ordinary residents, increases, the phenomenon of ‘the poor get richer and the rich get richer’ in North Korean society is expected to deepen.
Source: www.dailynk.com
