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The Korean People's won, sometimes known as the North Korean won (
Symbol A symbol is a mark, sign, or word that indicates, signifies, or is understood as representing an idea, object, or relationship. Symbols allow people to go beyond what is known or seen by creating linkages between otherwise very different conc ...
: ₩;
Code In communications and information processing, code is a system of rules to convert information—such as a letter, word, sound, image, or gesture—into another form, sometimes shortened or secret, for communication through a communicati ...
: KPW; Korean: ) or Democratic People's Republic of Korea won ( Korean: ), is the official currency of
North Korea North Korea, officially the Democratic People's Republic of Korea (DPRK), is a country in East Asia. It constitutes the northern half of the Korean Peninsula and shares borders with China and Russia to the north, at the Yalu (Amnok) and T ...
. It is subdivided into 100 ''chon''. The currency is issued by the
Central Bank of the Democratic People's Republic of Korea The Central Bank of the Democratic People's Republic of Korea is North Korea's central bank. Established on December 6, 1947, it issues the North Korean wŏn. The Bank is subordinated to the Cabinet of North Korea. Since 2021, the president of t ...
, based in the North Korean
capital city A capital city or capital is the municipality holding primary status in a country, state, province, department, or other subnational entity, usually as its seat of the government. A capital is typically a city that physically encompasses t ...
of
Pyongyang Pyongyang (, , ) is the capital and largest city of North Korea, where it is known as the "Capital of the Revolution". Pyongyang is located on the Taedong River about upstream from its mouth on the Yellow Sea. According to the 2008 populat ...
.


Etymology

''Won'' is a
cognate In historical linguistics, cognates or lexical cognates are sets of words in different languages that have been inherited in direct descent from an etymological ancestor in a common parent language. Because language change can have radical ef ...
of the
Chinese yuan The renminbi (; symbol: ¥; ISO code: CNY; abbreviation: RMB) is the official currency of the People's Republic of China and one of the world's most traded currencies, ranking as the fifth most traded currency in the world as of April 2022. ...
and
Japanese yen The is the official currency of Japan. It is the third-most traded currency in the foreign exchange market, after the United States dollar (US$) and the euro. It is also widely used as a third reserve currency after the US dollar and the ...
. All three names derive from the
Hanja Hanja (Hangul: ; Hanja: , ), alternatively known as Hancha, are Chinese characters () used in the writing of Korean. Hanja was used as early as the Gojoseon period, the first ever Korean kingdom. (, ) refers to Sino-Korean vocabulary, ...
(), which means "round shape." The won is subdivided into 100 chon (; ; McCune-Reischauer: ''chŏn'';
Revised Romanization Revised Romanization of Korean () is the official Korean language romanization system in South Korea. It was developed by the National Academy of the Korean Language from 1995 and was released to the public on 7 July 2000 by South Korea's Mini ...
: ''jeon'').


History


1947–2009

After the
division of Korea The division of Korea began with the defeat of Japan in World War II. During the war, the Allied leaders considered the question of Korea's future after Japan's surrender in the war. The leaders reached an understanding that Korea would be ...
,
North Korea North Korea, officially the Democratic People's Republic of Korea (DPRK), is a country in East Asia. It constitutes the northern half of the Korean Peninsula and shares borders with China and Russia to the north, at the Yalu (Amnok) and T ...
continued using the
Korean yen The Korean yen was the currency of Korea between 1910 and 1945. It was equivalent to the Japanese yen and consisted of Japanese currency and banknotes issued specifically for Korea. The yen was subdivided into 100 sen. It replaced the Korean ...
for two years, until the
Central Bank of the Democratic People's Republic of Korea The Central Bank of the Democratic People's Republic of Korea is North Korea's central bank. Established on December 6, 1947, it issues the North Korean wŏn. The Bank is subordinated to the Cabinet of North Korea. Since 2021, the president of t ...
was established on 6 December 1947 and the first North Korean won was issued. In February 1959, the second North Korean won was introduced, equal to 100 old won. From 1978 on, the North Korean government maintained an iconic rate of 2.16 won to the US dollar (which is said to have been based upon
Kim Jong-il Kim Jong-il (; ; ; born Yuri Irsenovich Kim;, 16 February 1941 – 17 December 2011) was a North Korean politician who was the second supreme leader of North Korea from 1994 to 2011. He led North Korea from the 1994 death of his father Ki ...
's
birthday A birthday is the anniversary of the birth of a person, or figuratively of an institution. Birthdays of people are celebrated in numerous cultures, often with birthday gifts, birthday cards, a birthday party, or a rite of passage. Many re ...
, 16 February). Over the decades, however, rampant inflation eroded the currency's value, and from 2001 the government abandoned the rate in favor of those closer to the black market's. A report by defectors from North Korea claimed the black market rate was ₩570 to the
Chinese yuan The renminbi (; symbol: ¥; ISO code: CNY; abbreviation: RMB) is the official currency of the People's Republic of China and one of the world's most traded currencies, ranking as the fifth most traded currency in the world as of April 2022. ...
(about ₩4,000 per U.S. dollar) in June 2009.


2009 revaluation

The third North Korean won was introduced in a revaluation , the first in 50 years. North Koreans were given seven days to exchange a maximum of ₩100,000 (worth approximately US$40 on the black market) in ₩1,000 notes for ₩10 notes, but after protests by some of the populace, the limit was raised to ₩150,000 in cash and ₩300,000 in bank savings.Harden, Blaine (2 December 2009)
'North Korea revalues currency, destroying personal savings'
''
The Washington Post ''The Washington Post'' (also known as the ''Post'' and, informally, ''WaPo'') is an American daily newspaper published in Washington, D.C. It is the most widely circulated newspaper within the Washington metropolitan area and has a large n ...
''.
The official exchange rate at this time was around $740, but black market value of the ₩150,000 was estimated to be near $30. The revaluation, seen as a move against private market activity, wiped out many North Koreans' savings. ''
The Times ''The Times'' is a British daily national newspaper based in London. It began in 1785 under the title ''The Daily Universal Register'', adopting its current name on 1 January 1788. ''The Times'' and its sister paper '' The Sunday Times'' ( ...
'' speculated that the move may have been an attempt by the North Korean government to control price inflation and destroy the fortunes of local black market money traders. The announcement was made to foreign embassies but not in North Korean state media.Parry, Richard Lloyd (2 December 2009)
North Koreans in shock as cash is 'banned'
''
The Times ''The Times'' is a British daily national newspaper based in London. It began in 1785 under the title ''The Daily Universal Register'', adopting its current name on 1 January 1788. ''The Times'' and its sister paper '' The Sunday Times'' ( ...
''.
As part of the process, the old notes ceased to be legal tender on 30 November 2009, but notes valued in the new won were not distributed until 7 December 2009. North Koreans were thus unable to exchange any money for goods or services for a week, and most shops, restaurants and transport services were shut down. The only services that remained open were those catering to the political elite and foreigners who both continued to trade exclusively in foreign currency. The measure led to concerns amongst North Korean officials that the move would result in
civil unrest Civil disorder, also known as civil disturbance, civil unrest, or social unrest is a situation arising from a mass act of civil disobedience (such as a demonstration, riot, strike, or unlawful assembly) in which law enforcement has difficulty ...
. China's
Xinhua Xinhua News Agency (English pronunciation: )J. C. Wells: Longman Pronunciation Dictionary, 3rd ed., for both British and American English, or New China News Agency, is the official state news agency of the People's Republic of China. Xinhua ...
news agency described North Korean citizens as being in a "collective panic"; army bases were put on alert and there were unconfirmed reports of public protests in the streets in a handful of North Korean cities and towns, forcing authorities to slightly increase the amount of currency people were allowed to exchange. Piles of old bills were also set on fire in separate locations across the country, old paper notes were dumped in a stream (against laws of the desecration of images of Kim Il-sung), and two black market traders were shot dead in the streets of Pyongsong by local police, according to international reports. Authorities threatened "merciless punishment" for any person violating the rules of the currency change. Pictures of the new notes were published on 4 December 2009 in the '' Chosun Shinbo'', a North Korean newspaper based in Japan. The paper claimed that the measure would weaken the free market and strengthen the country's socialist system. However, the won plummeted 96 percent against the
U.S. dollar The United States dollar ( symbol: $; code: USD; also abbreviated US$ or U.S. Dollar, to distinguish it from other dollar-denominated currencies; referred to as the dollar, U.S. dollar, American dollar, or colloquially buck) is the official ...
in the ensuing days after revaluation. Authorities eventually raised the limit to 500,000 won, Chosun said, and promised no probes into savings of up to one million won, and unlimited withdrawals if savings of more than one million were properly accounted for. In February 2010, some of the curbs on the free market were eased and a senior party official sacked after incidents of unrest. Pak Nam-gi, the director of the Planning and Finance Department of North Korea's ruling Workers' Party, was executed later in 2010. North Korea denied any serious crisis relating to the revaluation.


Coins


First Won

No coins were issued under the first won of 1947–1959.


Second Won

The first North Korean coins for circulation were minted in 1959 in denominations of 1, 5, and 10 chon. These coins were often restruck with the original dates in later years; however, 1970 and 1974 dates also appear on the 1 and 5 chon. In 1978, 50 chon coins featuring the
Chollima Statue The Chollima Statue () is a monument on in Pyongyang, the capital of North Korea. The monument symbolizes the "Chollima speed" of the Chollima Movement. The legendary winged horse Chollima depicted by the monument is said to travel 1,000  ...
and a rising sun were introduced into circulation during the 1979 currency reform to allow greater flexibility for vendors by eliminating the 50 chon banknote and large amounts of "small change" coinage carried. In 1987, 1 won coins featuring the Grand People's Study House were introduced, but did not fully replace the 1 won note which remained legal tender. When the historic 2.16 peg to the dollar was abandoned in 2001 to allow for greater
convertibility Convertibility is the quality that allows money or other financial instruments to be converted into other liquid stores of value. Convertibility is an important factor in international trade, where instruments valued in different currencies mus ...
the coins began to lose value. After 2003, these coins were rarely seen in circulation but were still redeemable. Later, a new set of coins was introduced in 2005 in denominations of 5, 10, 50, and 100 won. These coins were less impressive compared to the older series, being very plain and generic in design. All circulation coins of the Second Won were struck in aluminum. Following other
socialist Socialism is a left-wing economic philosophy and movement encompassing a range of economic systems characterized by the dominance of social ownership of the means of production as opposed to private ownership. As a term, it describes the ...
economies like Cuba and China, North Korea developed a special system of marking coins for two groups of foreign visitors. Issued in 1983, these coins were part of the "Pakkundon" convertible series. Coins with no "stars" were for general circulation in North Korea, coins marked with one star were for "socialist visitors", and coins marked with two stars were designated for "capitalist visitors". A fourth set, intended for collectors rather than circulation, was struck with the word "specimen" or "example" in Korean characters in the areas where the stars would be. The specimen/example set is the least common of the four. Besides the general circulating coins, there is an abundance of different commemorative coins minted in the name of the DPRK. Most, if not all of them, are sold to foreign numismatists. Some of these are official, state approved coins, others are not.


Third Won

Coins were issued in 10, 50 chon and 1 won denominations in 2002, and 1 and 5 chon denominations in 2008. All denominations are struck in aluminum. These coins feature the national coat of arms on the obverse and flowers, particularly the Kimjongilia and the Kimilsungia, on the reverse of the 10 and 50 chon coins. A magnolia adorns the 1 won coin. Initially struck in 2002, the coins were intended for use shortly after the dollar peg was removed from the currency. The 50 chon and 1 won coins were smaller than the previous designs, while the new 10 chon coin was the same size as the old. Hyperinflation became a very sudden reality, however, and the new coins were never released as planned. In 2008, 1 and 5 chon coins were also struck when a plan for monetary revaluation began. The coins were finally released into circulation in December 2009, but due to the flawed nature of the revaluation, these coins again have very little value, the 1 and 5 chon coins in particular being virtually irrelevant.


Banknotes

The first banknotes of "North Korea" were issued in 1945 by the Soviet-backed provisional government above the 38th parallel. These were in denominations of 1, 5, 10, and 100 won. These were discontinued shortly after Soviet forces withdrew and recognized the newly independent state.


First Won

This currency was issued in all-banknote form, with the first banknotes of this issue in denominations of 15, 20, and 50 chon along with 1, 5, 10 and 100 won in 1947. The chon notes had stylized art designs, while the won denominations were fairly uniform in design, featuring a farmer and a worker standing together and holding the symbolic tools. This currency was later revalued in 1959 at a rate of one new won to 100 old won to curb the inflation that had occurred as a result of the
Korean War {{Infobox military conflict , conflict = Korean War , partof = the Cold War and the Korean conflict , image = Korean War Montage 2.png , image_size = 300px , caption = Clockwise from top:{ ...
.


Second Won

In 1959, the old won was replaced with the Second Won, with price and exchange rates fixed to the U.S. dollar. This banknote series was issued in denominations of 50 chon, and 1, 5, 10, 50, and 100 won. These notes were much larger than the previous issue and depicted images representing various industries in the North Korean economy. In 1979, the currency was again reformed, and a new banknote series was issued in denominations of 1, 5, 10, 50, and 100 won. There is ongoing speculation as to why this move was made. All 1959 banknotes were removed from circulation. Circulating coins, however, were not affected by this change. The designs for this issue were much more symbolic and charismatic than previous ones, with Kim Il-sung featuring for the first time on the 100 won note. In 1992, another redesign was carried out for banknotes, again in denominations of 1, 5, 10, 50, and 100 won. Older notes were once again withdrawn. These notes were smaller and crisper than the previous issue and depicted more modern themes. The 5 and 10 won banknotes were again issued in 1998, along with a 500 won banknote that same year but were stamped rather than engraved reflecting poorer production quality. In 2002, 1,000 and 5,000 won notes were introduced, followed by a 200 won note in 2005. The former two were identical in design to the 100 won though differing in colors and added security features, but the colored fields behind the text no longer extended all the way to the margins. In 2007, the 500 won had also been revised in this same manner along with being engraved for the first time to protect against counterfeiting. From 1998 onwards, all notes were dated using the Juche year (Juche year) along with the standard dating. In 2005, the Central Bank of the Democratic People's Republic of Korea issued commemorative 200, 500, 1000 and 5000 won notes to celebrate the 60th anniversary of the foundation of North Korea. It consists of an overprint on its regular issue notes. In 2007, a commemorative version of this banknote series was released, stamped "Great Leader Comrade Kim Il Sung's 95th Birthday" on all denominations.
Banknote A banknote—also called a bill (North American English), paper money, or simply a note—is a type of negotiable instrument, negotiable promissory note, made by a bank or other licensed authority, payable to the bearer on demand. Banknotes w ...
s in circulation for the second won, up to December 2009, were as follows:


Third won

In 2009, was initiated to tackle hyperinflation and black market activities. Unlike previous reforms, the 2009 move sparked a nationwide panic when it was announced there would be a two-week waiting period between the withdrawal of the old currency and the introduction of the new currency, coupled with an exchange limit of only 500,000 old won for each person, effectively wiping out savings. The state eventually pulled back on most exchange limits; however, the revaluation proved to be a failure. Like the coins for this series, some of the denominations were initially printed in 2002 but were never released into circulation, pointing to a planned monetary revaluation much earlier than 2009 that was never carried out. The current series of banknotes of the third won are issued in denominations of 5, 10, 50, 100, 200, 500, 1,000, 2,000, and 5,000 won.
Kim Il-sung Kim Il-sung (; , ; born Kim Song-ju, ; 15 April 1912 – 8 July 1994) was a North Korean politician and the founder of North Korea, which he ruled from the country's establishment in 1948 until his death in 1994. He held the posts of ...
is depicted only on the obverse of the highest denomination, with the 100 won note featuring the
Magnolia ''Magnolia'' is a large genus of about 210 to 340The number of species in the genus ''Magnolia'' depends on the taxonomic view that one takes up. Recent molecular and morphological research shows that former genera ''Talauma'', ''Dugandiodendr ...
(National Flower) and other notes depicting North Koreans of different professions and various monuments in North Korea. The exchange rate was 100 second won to 1 third won. Unlike all previous series, these notes were all uniform in dimensions rather than staggered in size from smallest to largest. There are rumors that the original designs for the 1,000 and 2,000 won notes depicted Kim Il-sung and had similar design features to the 5,000 won that were scrapped and destroyed due to counterfeiters or thieves breaking into a bank warehouse and stealing early notes or printing materials, resulting in a total redesign of the two denominations in question. In 2012, another commemorative series of banknotes was released, this time in the 2002–2009 series but similarly stamped "Great Leader Comrade Kim Il Sung's 100th Birthday." Once again this stamp appeared on all denominations. In 2018, 1,000 and 2,000 won notes were released with an overprint referencing the 70th Anniversary of its independence. On 25 July 2014, a new 5,000 won note dated 2013 was released into circulation. Instead of depicting the portrait of North Korea's founder Kim Il-sung, the note depicts an image of his birthplace in Mangyondae and on the back the
International Friendship Exhibition The International Friendship Exhibition is a large museum complex located at Myohyangsan, North Pyongan Province, North Korea. It is a collection of halls that house gifts presented to former leaders Kim Il-sung and Kim Jong-il from various forei ...
in
Myohyangsan The Mount Myohyang (Hangul: 묘향산 - "''Mysterious Fragrant Mountain''") is a mountain in North Korea. It is named after the mystic shapes and fragrances found in the area. It is a sacred site as, according to legend, it was the home of Kin ...
that displays gifts he and his son Kim Jong-il received from foreign leaders. There has been ongoing speculation that this could indicate plans for higher denominations to be released later which would depict Kim Il-sung, Kim Jong-il, or possibly both. However the official reason behind the change was to combat counterfeiters.


''Donpyo'' emergency currency

Lockdowns due to the
COVID-19 pandemic The COVID-19 pandemic, also known as the coronavirus pandemic, is an ongoing global pandemic of coronavirus disease 2019 (COVID-19) caused by severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2). The novel virus was first identi ...
have caused shortages in ink and paper used to print regular KPW banknotes, resulting in the issuance in the second half of 2021 of an emergency currency printed with the word "donpyo" (돈표 or "money coupon"). It is denominated 5,000 won and printed in red ink on white paper of poor quality. Shortages in regular KPW banknotes after 2020 have also resulted in a premium in their exchange values in the black markets. The ''donpyo'' is discounted versus regular banknotes at only 3,800-4,000 KPW, and KPW banknotes have even appreciated versus the US dollar from 8,000 KPW to 5,200 KPW/USD.


Exchange rates

The North Korean won is not traded in the international markets. It is traded in the unofficial black markets at around US$1 = 8,000 KPW as of 2019 and around $1 = 5,000 KPW as of 2021.


Concurrent use with foreign currencies


Before 2009

North Korean won are intended exclusively for North Korean citizens, and the Bank of Trade (무역은행) issued a separate currency (or foreign exchange certificates) for visitors, like many other
socialist state A socialist state, socialist republic, or socialist country, sometimes referred to as a workers' state or workers' republic, is a sovereign state constitutionally dedicated to the establishment of socialism. The term '' communist state'' is ...
s. However, North Korea made two varieties of foreign exchange certificates, one for visitors from "socialist countries" which were colored red and hence nicknamed "red won", and the other for visitors from "capitalist countries" which were colored blue/green and hence known as "blue won". For the 1978 banknote series, foreign certificates, called "Pakkundon", meaning "exchangeable money" were implemented by an overstamp and serial number color. This was intended to protect the value of the national currency in North Korea's
command economy A planned economy is a type of economic system where investment, production and the allocation of capital goods takes place according to economy-wide economic plans and production plans. A planned economy may use centralized, decentralized, p ...
. These were first released in 1983 in two forms, one for "socialist visitors" which had a red stamp, and one for "capitalist visitors" which had a green stamp. Another series was released in 1986 with either a blue or red Guilloché style stamp. These were issued in all denominations, except for the ₩100 note, presumably because it was assumed by the government that foreign visitors to North Korea would not show proper respect for its depiction of Kim Il-sung. These notes were discontinued in 1988 and replaced with a new series of Pakkundon in all banknote form that was more distinguishable and unmistakable from generic circulation currency. In 1988, the Bank of Trade (무역은행) (as opposed to the Central Bank) issued two unique series of foreign certificates. They both included 1 chon, 5 chon, 10 chon, 50 chon, ₩1, ₩5, ₩10, and ₩50. The series for "capitalist visitors" was blue-green, while the series for "socialist visitors" was pink. The chon notes had a simple design of patterns and corresponding values, while the socialist won notes depict the
International Friendship Exhibition The International Friendship Exhibition is a large museum complex located at Myohyangsan, North Pyongan Province, North Korea. It is a collection of halls that house gifts presented to former leaders Kim Il-sung and Kim Jong-il from various forei ...
, and the capitalist won notes depict the
Chollima Statue The Chollima Statue () is a monument on in Pyongyang, the capital of North Korea. The monument symbolizes the "Chollima speed" of the Chollima Movement. The legendary winged horse Chollima depicted by the monument is said to travel 1,000  ...
.Bank notes of the modern world – North Korea
bank-note.org.
FECs were used until 1999, then officially abolished in 2002, in favor of visitors paying directly with hard currencies.


Since 2009

After the 2009 revaluation the BBC reported that in some department stores in
Pyongyang Pyongyang (, , ) is the capital and largest city of North Korea, where it is known as the "Capital of the Revolution". Pyongyang is located on the Taedong River about upstream from its mouth on the Yellow Sea. According to the 2008 populat ...
, the North Korean won is not accepted; the stores only take
Japanese yen The is the official currency of Japan. It is the third-most traded currency in the foreign exchange market, after the United States dollar (US$) and the euro. It is also widely used as a third reserve currency after the US dollar and the ...
and
U.S. dollars The United States dollar (symbol: $; code: USD; also abbreviated US$ or U.S. Dollar, to distinguish it from other dollar-denominated currencies; referred to as the dollar, U.S. dollar, American dollar, or colloquially buck) is the official ...
. As of 2018 it has evolved to most North Korean stores accepting
U.S. dollar The United States dollar ( symbol: $; code: USD; also abbreviated US$ or U.S. Dollar, to distinguish it from other dollar-denominated currencies; referred to as the dollar, U.S. dollar, American dollar, or colloquially buck) is the official ...
s,
euro The euro ( symbol: €; code: EUR) is the official currency of 19 out of the member states of the European Union (EU). This group of states is known as the eurozone or, officially, the euro area, and includes about 340 million citizens . ...
s and Chinese yuan/
renminbi The renminbi (; symbol: ¥; ISO code: CNY; abbreviation: RMB) is the official currency of the People's Republic of China and one of the world's most traded currencies, ranking as the fifth most traded currency in the world as of April 202 ...
, with change from transactions primarily returned in renminbi or U.S. dollars. Foreign visitors (and privileged locals) can buy goods priced in 'tied' won using a local debit card, which is credited when exchanging foreign currency at the official bank rate of around 104 won/USD or 130 won/EUR (as of 2012). This card can be used for instance at the famous
Pyongyang Department Store No. 1 The Pyongyang Department Store No. 1 ( ko, 평양제1백화점) is a major retail store in Pyongyang, North Korea. On Sungri Street near Kim Il-sung Square in downtown Pyongyang, it is one of the largest retail stores in the country and is often ...
or at the different stores at the international hotels, where the goods are priced at the tied won rate. This tied won does not exist in the form of bank notes, and is effectively a separate currency and accounting unit for sales involving foreign exchange. In normal stores and markets goods are priced in what has been called the 'untied' won or free market rate which is represented by regular KPW banknotes. At for instance the Tongil Market and the Kwangbok Department Store (a.k.a. the Chinese Market) there are semi-official exchange agents who will give in regular banknotes around 8,000 KPW/USD or 10,000 KPW/EUR to locals and foreign visitors alike (as of 2012, or 77 times the tied or official rate). The untied KPW is used for prices in normal shops outside restricted state shops/tied won shops.Black Market cash: the real value of N. Korean won, NK News, 1 September 2014 http://www.nknews.org/2014/09/black-market-cash-the-real-value-of-n-korean-won/


See also

*
Economy of North Korea The economy of North Korea is a centrally planned economy, following '' Juche'', where the role of market allocation schemes is limited, although increasing. , North Korea continues its basic adherence to a centralized command economy. With a ...
*
South Korean won The Korean Republic won, unofficially the South Korean won ( Symbol: ₩; Code: KRW; Korean: 대한민국 원) is the official currency of South Korea. A single won is divided into 100 jeon, the monetary subunit. The jeon is no longer used ...


References


External links

* {{Portal bar, Asia, Money, North Korea, Numismatics Currencies of North Korea Currencies introduced in 1947