Saturday, September 17, 2005

N.Korea introduces first 'credit card'

North Korea announced on Friday the introduction of the Stalinist country's first credit card, but just how it would work was unclear. "The North East Asia Bank of the Democratic People's Republic of Korea has introduced (an) IC credit card ... in order to modernise its settlement business," the official Korean Central News Agency reported. "The IC card ensures the safety of the data registered in it. And it is impossible to counterfeit it so as to prevent money from being lost," KCNA said. "Six kinds of currencies can be deposited in a card at a time. With this card, one can exchange money instantly without going to a money exchange booth. A card can be shared by several persons (family members, relatives, friends, etc.)," it said. It appeared that, whatever currencies the carrier held, the card would only deliver cash in the local won currency. There was no word of an international tie-in nor any suggestion that the card -- IC stands for integrated circuit -- could be used beyond the borders of North Korea, a police state which allows only a tiny percentage of its population to travel abroad. North Korea's centrally planned economy has never recovered from the collapse of the Soviet Union, which brought an end to decades of barter trade with the Communist bloc. Forced to pay market prices for imports, the economy faltered. Years of natural disasters in the 1990s then brought widespread famine, and Pyongyang was forced to go cap in hand to the international community for emergency food aid. Tentative economic reforms along the lines of those begun by its key ally, China, in the late 1970s were introduced but there has been little sign of a clear turnaround. Strapped for foreign currency, authorities have had to rely on cash contributions from Japan's large pro-Pyongyang Korean community. Many foreign governments accuse the North of illicitly raising more money abroad through currency counterfeiting and drug smuggling.


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