Demand for Chinese yuan grows in N. Korean private markets: report

North Korea's unofficial private market, known as "jangmadang" is seen in this photo, Sept. 22, 2020. Yonhap

Demand for the Chinese yuan appeared to be growing in North Korea's private markets, a report showed Wednesday, in a sign of rising distrust over the North's own currency.

Some 68.4 percent of North Korean defectors who left their home country between 2016 and 2020 said they used the Chinese yuan in unofficial private markets, known as "jangmadang", compared with 6.4 percent of those who defected before 2000, according to a draft report on the North Korean economy and society compiled by the unification ministry.

Some 25.7 percent of the respondents in the first group said they used the North Korean currency in such markets, sharply down from 81.6 percent in the latter group.

The document also showed that 58.7 percent of those who defected in the 2016-2020 period owned foreign currency, such as the Chinese yuan and the U.S. dollar, compared with 10.7 percent who said they only owned local currency.

The figure marked a sharp increase compared with 3.9 percent of North Koreans who defected before 2000 who owned foreign currency. Some 53 percent had said they owned no cash, while 27.4 percent said they only owned the North Korean currency.

The report comes as the North Korean economy has been trending toward marketization in the past decade as state benefits, such as food rationing, appeared to be worsening amid economic woes deepened by sanctions.

The North Korean economy shrank for a third consecutive year in 2022 amid international sanctions and the prolonged COVID-19 pandemic, according to data compiled by South Korea's statistics agency.

The unification ministry is expected to release its findings from the report based on information obtained from 6,351 defectors later this month. (Yonhap)