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The move was also seen by many observers as an attempt by the country's leaders to reassert control over an emergent market economy.

But the scheme, which involved redenominating the North Korean won, reportedly lead to widespread panic and unrest as many North Koreans saw their savings wiped out.

Yonhap said Pak was executed after he was accused of ruining the nation's economy through the currency revaluation.

It said the botched scheme which had worsened public opinion and had a negative impact on plans by Kim Jong-il, North Korea's leader, to hand power over to his youngest son.

Scapegoat

Pak had been one of Kim's close associates and frequently accompanied the leader on his trademark "field inspections" to farms, factories and military bases across North Korea.

Revaluation of the won reportedly sparked widespread unrest [GALLO/GETTY]

The agency said many North Koreans believed Pak had been made a scapegoat for the failure of the revaluation.

South Korea's unification ministry and the National Intelligence Service (NIS) could not confirm the reports.

Under the revaluation, North Koreans were reportedly entitled to exchange only up to 150,000 old won – equivalent to about $60 at black market rates - to new won, at a rate of 100 to 1.

Groups with contacts in North Korea said the move had hit private traders particularly hard, driving many out of business and worsening food shortages in the isolated and impoverished country.

Recent years had seen a network of officially-tolerated private markets develop across North Korea with many North Koreans relying on them for food and other essentials.

But analysts say the government had become increasingly concerned about the power some traders were amassing and the threat they posed to officials' tight control over North Korean society.