![]() ![]() It’s unclear what Kim would do, since banning use of dollars and yuan could backfire by just confusing and angering the public, experts say. “The current direction of the North’s economy is controlling markets in a stronger manner so there are still limits in demands for dollars.” while maintaining a border shutdown,” said Lim Eul-chul, a professor at Kyungnam University’s Institute for Far Eastern Studies in Seoul. ![]() ![]() “He has no other choice but to strengthen the command economy as he’s been locked in confrontations with the U.S. Now, observers say Kim is trying to roll back use of the dollar and yuan to tighten his grip on power as the North grapples with pandemic-related hardships, longstanding U.N. The isolation of the pandemic badly hurt the North's economy but still gave Kim a chance to solidify social controls by restricting market activities and limiting influence from capitalist, democratic South Korea. But the trend poses a potential threat to Kim as it has undermined his government’s control over money supply and monetary policies. The so-called “dollarization” helped ease inflation and stabilize exchange rates, enabling leader Kim Jong Un to establish a stable hold on power after he inherited that role in late 2011. dollars and Chinese yuan since a bungled revaluation of the won in 2009 triggered runaway inflation and public unrest. North Korea has tolerated the widespread use of more stable foreign currencies like U.S. “Even the quality of North Korean bills was awful as they often ripped when we put them in our pockets.” “There were not many places to use the won, and we actually had little faith in our currency,” Jeon said during a recent interview in Seoul. ![]() He used the domestic currency, the won, only occasionally. dollars as a store of value and used Chinese yuan to make everyday purchases at markets, restaurants and other places. SEOUL, South Korea - Before fleeing North Korea in 2014, Jeon Jae-hyun kept U.S. ![]()
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