Exchange Rate Us Dollar To North Korean Won
North Korea is a country that is known for its isolationist policies and strict regulations. One of the many things that sets North Korea apart from other countries is its currency, the North Korean won. The North Korean won is not a commonly traded currency, and its exchange rate can be difficult to find. This article will explore the exchange rate between the US dollar and the North Korean won, and what factors can affect the exchange rate.
Understanding the North Korean Won
The North Korean won is the official currency of North Korea. It is abbreviated as KPW, and is issued by the Central Bank of the Democratic People's Republic of Korea. The North Korean won is a non-convertible currency, which means that it cannot be freely exchanged for other currencies on the international market.
North Korea has strict regulations on foreign currency exchange. The country has a dual-currency system, where the North Korean won is used by locals, and foreign currencies such as the US dollar and Chinese yuan are used by tourists and foreigners. The exchange rate for foreign currencies is set by the North Korean government, and is not based on market forces.
Exchange Rate of US Dollar to North Korean Won
The exchange rate of the US dollar to the North Korean won is difficult to determine, as the North Korean government does not release official exchange rate information. However, it is commonly believed that the North Korean government sets an official exchange rate that is much higher than the actual market rate. This means that foreigners who exchange their US dollars for North Korean won will receive fewer won than they would if they exchanged on the black market.
As of August 2021, the black market exchange rate for the US dollar to North Korean won is estimated to be around 8,000 won to one US dollar. However, this rate can fluctuate greatly depending on various factors such as political tensions, economic sanctions, and the supply and demand of foreign currency in the country.
Factors Affecting the Exchange Rate
There are several factors that can affect the exchange rate of the US dollar to the North Korean won. One of the biggest factors is political tensions between North Korea and other countries. When there are high tensions between North Korea and the US or South Korea, for example, the exchange rate can fluctuate greatly. This is because investors and traders may become hesitant to invest in North Korea, causing a decrease in demand for the North Korean won and a decrease in its value.
Another factor that can affect the exchange rate is economic sanctions. North Korea is subject to several economic sanctions by the United Nations and other countries due to its nuclear weapons program. These sanctions can limit the country's ability to trade with other countries and can cause a decrease in the supply of foreign currency in the country. This can cause the exchange rate to rise, as there is less foreign currency available to exchange for North Korean won.
Conclusion
The exchange rate of the US dollar to the North Korean won is difficult to determine, as the North Korean government does not release official exchange rate information. However, it is commonly believed that the actual market rate is much lower than the official rate set by the government. The exchange rate can be affected by various factors such as political tensions and economic sanctions. As such, it is important for foreigners to be cautious when exchanging their currency in North Korea and to be aware of the risks involved.