North Korea's grass-root market forces are increasingly dependent on the dollar and the yuan, rather than the nation's currency, the won, due to a mistrust of their communist regime, an informed source here said Tuesday.

"It would be fair to say that Pyongyang has become a de-facto dollar-using economy, while border regions and economic zones such as the Rajin-Sonbong area are almost a yuan-using one," the source said, referring to a burgeoning market economy in the North.

The popularity of the U.S. and Chinese currencies is a by-product of growing black market activities there. One dollar is worth about 100 won in the North, according to the source.

North Koreans are shunning banks as they don't trust the authorities, limiting the effects of expanding consumption to other economic sectors, the source said.

A South Korean government official also said the North's economy is still far from full-fledged recovery.

"It seems certain that there is a slight growth trend. In general, however, it is hard to say that the North's economy has fully recovered," the official said on background.

On inter-Korean ties, meanwhile, another official said the Park Geun-hye administration is determined to maintain its firm approach toward Pyongyang from a longer-term perspective.

"Now that the government's aim is to achieve the normal development of South-North relations, sticking to principles is needed even if it takes some time (to improve bilateral ties)," the unification ministry official told reporters. It's not desirable to accept Pyongyang's "unjust" demand for the sake of dialogue, he pointed out. (Yonhap)