Korea, North - Money



North Korea used to have multiple exchange rates , but now has a single, fixed rate set by the Central Bank of North Korea. A free- floating exchange rate , determined by supply and demand, exists in the Rajin-Sonbong Free Economic and Trade Zone only (a zone in the north of Korea in which state control has been relaxed and free-market interactions flourish). This rate, and that of the black market , reveal the lack of worth of the North Korean currency. In 1999, floating and black market rates revealed an exchange rate of 200 won to US$1, while the official rate was 2.20 won to US$1. The economic upheavals of the 1990s had no impact on the official fixed rate, which has been kept just higher than 2 won against the U.S. dollar since 1989. The artificial rate and the low value of the North Korean won on the open market have made it very difficult for the country to trade with most modernized economies. North Koreans and foreigners are subject to exchange restrictions, with certain exceptions in the Rajin-Sonbong zone.

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