The reported execution of a ranking North Korean economic official is a reminder of the high personal price that can be paid for policy failures in that country. The official may be a scapegoat, but the sentence is a sign of the Pyongyang leadership's concern about the toll that a botched currency reform effort has taken on the economy. Economic mismanagement is not only a growing burden for the long-suffering North Korean people, but also an obstacle to supreme leader Kim Jong Il's plans to pave the way for his successor.
In a surprise move last November, North Korea announced it was introducing new bank notes and would require citizens to exchange old bills for new ones at a rate of 100 to 1. More worrying to most citizens was that the amount of money that could be exchanged was limited to 100,000 to 150,000 old won. That essentially amounted to a confiscation of private savings.
The decision served two purposes. First, it was intended to slow rising inflation that was said to be skyrocketing. The blame for that belongs on the top-down system of economic management, which has been exacerbated by a poor rice harvest that has driven up prices and encouraged producers to divert their products to private markets rather than sell to the government at its artificially low price.