User:Jrell99/Jangmadang

After the collapse of the public distribution system in North Korea, the North Korean government  allowed private markets. They originally sold essential items, rice and vegetables.[1] Private markets evolved from local communities involving various organizations, workplaces, relatives and neighbors, that helped people to survive during the famine. Many of these mutual-help arrangements broke up later on, as markets developed.

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North Korea established a socialist welfare system in 1948, with the Constitution of the Democratic People’s Republic of Korea. This system nationalized the means of production and the population received goods, food, and other necessities through a public distribution system. As a result of the 1994-1999 famine, also known as the Arduous March or the March of Suffering, the distribution of rations was reduced drastically. Citizens were forced to secure food and other necessities through different means. North Koreans farmed land deemed “unusable for agricultural purposes” by the government or even small kitchen gardens to provide for their families. These illegal private farms were able to produce crop yields larger than the public agriculture programs. Farmers sold off any surplus of goods or bartered for other necessities.

These grey markets have seen an influx of foreign currencies, mainly the Chinese Yaun and the United States dollar. The Chinese Yuan has become generally accepted tender in most of these markets and the dollar can be seen in newer digitalized businesses. This caused dramatic changes in the valuation of the North Korean won, which the government tried to correct in 2009.

Ultimately, the currency reform failed as official and black-market exchange rates for the North Korean Won continued to depreciate. This caused a second attempt at reform in 2012, which cause further depreciation before leveling off around 8000 North Korean won per United States dollar.

A study conducted by the Center for Strategic and International Studies found at least 436 officially sanctioned markets across the country in 2018. These markets generate an estimated number of $56.8 million annually in taxes and rent, and have become a larger part of the nations economy than even the government would like to admit. In fact, they often propagandize against the privatization of business and boast of their own self reliance.

North Korea suffered from a famine from 1994 to 1999, which killed between two and three million people from starvation and other hungry-related illnesses.