The first Korean paper banknotes were issued at the beginning of the 20th century - it was a currency in denominations of 1 won. Before that, there were coinage Korean yangs in circulation. From 1910 to 1945, the currency of Korea, which was then annexed to the Japanese Empire, was the Korean yen. In 1945, following the results of the Second World War, Korea was declared independent and divided into North and South Korea. Since then, two different national currencies have been circulating in these two states.
North Korean currency
Currently, North Korea is called the Democratic People's Republic of Korea - DPRK. After the partition of Korea, North Korea was declared the territory of influence of the USSR, in connection with which from 1945 to 1947, in addition to the Korean yen, military wons printed in the USSR were also used on its territory. Since 1947, the North Korean won (DPRK won) has become the official currency of North Korea. The yen were exchanged for won at a 1: 1 rate. In 2009, the DPRK government introduced a new model of won, announcing the denomination of the old won within two weeks at a rate of 100: 1 and 1000: 1 in cases of exceeding the established daily exchange rate. This course of denomination led to massive impoverishment of the population and social unrest.
The international designation of the DPRK won is KVP. One won equals 100 chon. There are paper won in denominations of 10, 50, 100, 500, 1000 and 5000 won, as well as aluminum coins in denominations of 1 and 5 won, 1 and 5 chon. According to the legislation of the DPRK, foreigners must pay on the territory of the country only in specialized stores and only in foreign currency - in euros, less often in dollars. The use of North Korean won by foreign citizens is prohibited, the export of national currency outside the state is prohibited. Exchange of the North Korean won for other currency is possible on the black market, but this may entail confiscation of funds, arrest or deportation. For citizens of the DPRK, from January 1, 2010, a ban was introduced on the use of foreign currency on the territory of the state - payment for goods and services is provided only in national currency.
South Korean currency
South Korea is currently called the Republic of Korea. After the end of World War II and until 1953, the Korean yen and the old-style won were the currency of South Korea. In 1953, the South Korean hwans were introduced - the won were denominated at a rate of 100: 1. Because South Korea was considered the territory of US influence, the Hwang exchange rate was strongly pegged to the dollar. Over the course of nine years, the exchange rate of the Khvan against the dollar was constantly falling, reaching in 1961 the mark of 1,300 Khwans = 1 dollar. To stabilize the monetary unit, the South Korean won was declared the national currency of South Korea in 1962. The exchange of hwans for new won was carried out at the rate of 10: 1. To strengthen the new currency, its rate was artificially attached to the dollar at the rate of 125 won = 1 dollar. In 1980, a gradual transition to a floating exchange rate began, which is used in South Korea today.
The international designation for the South Korean won is KWR. In circulation are paper notes in denominations of 500 to 10,000 won and coins in denominations of 10 to 500 won. In 2006, after problems with currency counterfeiting, South Korea began to issue banknotes with special protection, which includes 10 functions and is a feature of the modern won in comparison with other currencies.
