On November 11, a South Korean diplomat in Beijing revealed that Chinese currency is getting more popular in North Korea than the US dollar, as transactions via the Chinese currency renminbi make it easier for the North to evade international sanctions against its nuclear and missile programs.
According to the diplomat, the use of foreign currencies is prevalent in the black market, although the North regime officially bans people from using foreign currencies, including the yuan and the US dollar.
The diplomat said it is not rarely seen for people in the North’s capital Pyongyang to use the renminbi to pay for taxi fares instead of the North Korean won.
“North Korean people and firms are increasingly using the yuan instead of the US dollar, because transactions via the Chinese currency can minimize their exposure to international sanctions,” the diplomat added.
The yuan’s strength against the US dollar is another reason for the yuan’s popularity in the North. “In the first nine months of this year, the value of the US dollar was averaged at 7,500 won to 8,500 won, while the yuan value was averaged at 1,250 won to 1,350 won,” the diplomat said.
The growing popularity of the yuan also means economic ties between Pyongyang and Beijing are getting closer, the diplomat added.
According to data released by the China Customs Information Center, North Korea’s trade with China increased 4.4 percent from a year earlier to US$4.69 billion during the nine-month period. North Korea’s exports to China jumped 9.4 percent to US$2.09 billion, while its imports from China fell 2.3 percent to U$2.6 billion.