North Korean Economy—The Dollar

For John, BLUF:  If North Korea collapses, it won't be pretty.

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This is from Yonhap News Agency, a report on the North Korean economy, N. Koreans rely more on dollar, yuan in black market: source.

SEOUL, Feb. 10 (Yonhap) -- North Korea's grass-root market forces are increasingly dependent on the dollar and the yuan, rather than the nation's currency, the won, due to a mistrust of their communist regime, an informed source here said Tuesday.

"It would be fair to say that Pyongyang has become a de-facto dollar-using economy, while border regions and economic zones such as the Rajin-Sonbong area are almost a yuan-using one," the source said, referring to a burgeoning market economy in the North.

The popularity of the U.S. and Chinese currencies is a by-product of growing black market activities there. One dollar is worth about 100 won in the North, according to the source.

North Koreans are shunning banks as they don't trust the authorities, limiting the effects of expanding consumption to other economic sectors, the source said.

Regimes may collapse when their currency is no longer viable.

Regards  —  Cliff