Chinese Envoy in Seoul Slammed N.Korea's Botched Currency Reform

      January 05, 2011 12:36

      The Chinese ambassador to South Korea was highly critical of North Korea's botched currency reform at the end of 2009, calling it a "mistake" that risked "further alienating the populace," according to confidential diplomatic cable revealed by WikiLeaks. Cheng Yonghua told U.S. Ambassador to South Korea Kathleen Stephens over dinner that the North "would be much better off today if it had followed China's path to reform."

      Chen "commented that being behind the times had historical roots for Korea. He noted wryly that 100 years after the Qing Dynasty had supplanted the Ming, Korea insisted on sending its tributes to the Ming Court and clinging to Ming customs and traditions." He said that as a small nation, "the Korean response when confronted with a rapidly changing environment was to hunker down out of fear that it would cease to exist if it succumbed to change."

      Cheng, currently ambassador to Japan, had dinner with Stephens on Dec. 21, 2009. The currency reform, he said, was "ill-advised attempt to reassert the regime's control over the economy." He added he personally believes that when ordinary people start to earn money "it is very difficult to put the genie back in the bottle."

      Political Counselor at the Chinese Embassy in Seoul Chen Hai, who was present at the dinner, "cited a conversation about trade deficits between Vice Foreign Minister Wu Dawei and [North Korean] First Vice Foreign Minister Kang Sok-ju in which Kang... appeared to have no grasp of the concept of a trade deficit," according to the cable.

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