Official: Policy failure raises N. Korea's economic uncertainty

SEOUL (Yonhap) - North Korea's botched currency reform has dealt a severe blow to the impoverished country and increased its economic uncertainty, a South Korean official said Sunday.
The ill-fated currency reform in 2009 is believed to have caused strong backlash among North Koreans as it led to massive inflation and worsened food shortages.
The policy blunder has also "undermined the social stability," South Korean Unification Minister Hyun In-taek said in a program aired Sunday on public broadcaster KBS.
Hyun, who is in charge of relations with North Korea, also said North Korean leader Kim Jong-il's plan to hand over his power to his youngest son is believed to be in progress. He did not elaborate.
The elder Kim named his youngest son, Jong-un, vice chairman of the Central Military Commission of the North's ruling Workers' Party and a four-star general last year in the clearest sign yet of making him the next leader.
The succession, if made, would mark communism's second hereditary power transfer. The elder Kim inherited power from his father, the North's founder Kim Il-sung, who died in 1994.
Hyun's comments came days after South Korea's top intelligence official told lawmakers that policy failures on the currency reform and housing projects have undermined Kim Jong-un's leadership.
Won Sei-hoon, head of the National Intelligence Service, said last week that the North has dramatically cut its goal of building 100,000 houses by next year, the centennial of the birth of the country's late founder and grandfather of Kim Jong-un, according to lawmakers.
The North has so far built some 500 houses in its capital of Pyongyang, according to the spy agency.