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N. Korea Revalues Won, Wipes Out Savings: Report

North Korea's government revalued the country's currency but restricted severely the amount of old bills that can be changed for the new ones, wiping out personal savings, the Washington Post reported Wednesday.

The move sparked panic and anger, as much of the old North Korean won has become worthless, the paper reported, citing news agency reports from South Korea and China and groups with contacts in North Korea.

In the revaluation, which took place at the weekend, 1,000-won notes are replaced by 10-won notes but the amount of old currency that can be exchanged is drastically limited, news reports said.

That limit was first set Monday at 100,000 won, which at current black-market rates amounts to $40, according to two Web-based groups with sources in the North.

After widespread protests, the limit was raised to 150,000 won in cash and 300,000 won in bank savings, other reports said.

North Korean leader Kim Jong Il
Getty Images
North Korean leader Kim Jong Il

All North Korean currency that individuals possess in excess of that amount becomes worthless.

The move seems to be part of a government crackdown on private markets for food products, as in recent years some market traders have saved substantial amounts of cash, with the government struggling to control their business.

"I worked like a dog for two months for the winter, but the money became useless paper overnight," a resident of Sinuiju, a city that borders China, was quoted as saying on the Web site of Good Friends, a South Korea-based aid organization with informants in the North.

In Pyongyang, the North Korean capital, that state-run shops were closed Tuesday as sales staff posted new prices on goods, the paper quoted the China's official New China News Agency.

If the measures seriously disrupt the functioning of local markets in North Korea, millions of people who depend on them for food could suffer, the paper said.

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