N. Korea Issues Lottery Style Public Bonds

North Korea started to issue public bonds from May 1, reported Japanese newspaper Asahi on May 7 quoting Korean Central News Agency of Democratic People`s Republic of Korea.

North Korea seemed to decide to issue public bonds to complement its lacking budget by drawing money from residents` private accounts, the Asahi newspaper reported.

The last time, the N. Korea issued public bonds was right after the Korean war, hence public bonds have not been issued for last 50 years. There are 3 types of bonds, 500 won, 1000 won, and 5000 won bonds. North Koreans as well as Korean residents abroad can also purchase the bonds.

The special characteristic of the bonds is that it took the lottery system repayment scheme. The first place winners will get 50 times of the nominal value. The drawing will take place from this year biannually until year 2004 and annually between 2005 and 2008.

Hun-Joo Cho hanscho@donga.com