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N. Korea exploits foreign visitors by applying its “official exchange rate” to transactions

North Korea is exploiting foreign visitors by applying an artificially high official exchange rate, likely to compensate for the regime’s foreign currency shortage.

A Chinese entrepreneur named Cho, who led a trade delegation to North Korea, shared his experience on Chinese social media platform Kwai (Kuaishou) in April. He reported spending RMB 1,200 (about KRW 228,000) in a single day on a mobile SIM card for foreigners, which cost RMB 12 per minute. This expense is extraordinarily high compared to typical Chinese mobile plans, which cost around RMB 66 – 88 (KRW 12,500 – 16,700) monthly.

Furthermore, foreigners purchasing items on North Korean shopping websites are being charged prices over a hundred times higher than those for North Koreans. Cho described buying from a North Korean website called Dawn Transaction New Hope Store. While prices are listed in North Korean won (KPW), foreigners are charged in dollars at checkout, based on the government’s official exchange rate that drastically overvalues the KPW.

A North Korean guide in a video uploaded by Cho explains that “the dollar price of our goods for foreigners is calculated as 1/100 of the local price.” For example, a cake listed at KPW 4,400 would cost a foreigner USD 44, applying the government rate of KPW 100 per dollar.

The Dawn Transaction New Hope Store sells various North Korean-produced items, including factory goods, pharmaceuticals, and foodstuffs. Food items range from cakes and box lunches to fried chicken sandwiches, kimbap, beverages, and wine, with prices in KPW that translate to exorbitant dollar amounts for foreigners.

Interestingly, while North Korea applies this inflated exchange rate to foreign visitors, most North Koreans are unaware of it. A source in North Pyongan Province told Daily NK that “the official exchange rate has been a dead letter for a long time now. The price is listed at foreign currency stores and department stores for foreigners, but I don’t actually know how it’s used.”

Daily NK works with a network of sources living in North Korea, China, and elsewhere. Their identities remain anonymous for security reasons. For more information about Daily NK’s network of reporting partners and information-gathering activities, please visit our FAQ page here.

Please send any comments or questions about this article to dailynkenglish@uni-media.net.

Read in Korean

July 04, 2024 at 07:15AM

by DailyNK(North Korean Media)

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