Foreign Currency News: Reforms in Korea

When it comes to understanding foreign currency, we need to be aware of what's happening in the world. There are so many things that can affect our foreign currency exchange rates. For those who conduct a lot of business abroad, or for those who travel on a regular basis, understanding exchange rates and keeping a keen eye on world affairs is important.

In November 2009, North Korea launched an unexpected confiscatory currency reform in order to revive socialism and crack down on private markets. This political/financial move caused controversy in North Korea, and while there may be changes in foreign currency, there could be more than just a destabilised economy to worry about – this could lead to disconcerted country politics.

Foreign Currency Chaos in North Korea

As anyone would have predicted, the currency reform created a disparaging commotion in the country, and although currency reforms are not usually a negative thing, when executed without warning or consideration, it can cause serious political issues. Governments have used currency reforms in the past to calm the period after inflation and in recent years, countries such as Ghana, Romania and Turkey have all done this.

Back in 2009, North Korea completely banned the use of foreign currency to consolidate even further that the communist government was ready to take complete control over the flourishing economy. Now currency reforms have been put into place to reiterate once again that socialism is in place to keep economic growth under control. Disallowing foreign currency was a communist measure to moderate private markets, but has the reform been one step too far? The North Korean case is different because the Koreans had no warning and such a reform wiped off household savings, with a limit that left people panicking. Koreans started panic buying in order to offload their redundant currency.

Keeping Up to Date with Foreign Currency News
If you travel for business, or you trade with companies in other countries, it's important to be aware of current affairs around the world. Whether it's trade, finance, politics, or anything else that concerns the rest of the globe, it's important to understand what is affecting our foreign currency rates.

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