Transcript North Korea

North Korea
one of the world's most centrally
planned and isolated economies
Economy overview
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Industrial capital stock is nearly beyond repair as a result of years of
underinvestment and shortages of spare parts. Industrial and power output have
declined in parallel. Despite an increased harvest in 2005 because of more stable
weather conditions, fertilizer assistance from South Korea, and an extraordinary
mobilization of the population to help with agricultural production, the nation has
suffered its 11th year of food shortages because of on-going systemic problems,
including a lack of arable land, collective farming practices, and chronic shortages of
tractors and fuel. Massive international food aid deliveries have allowed the people of
North Korea to escape mass starvation since famine threatened in 1995, but the
population continues to suffer from prolonged malnutrition and poor living conditions.
Large-scale military spending eats up resources needed for investment and civilian
consumption. In 2004, the regime formalized an arrangement whereby private
"farmers markets" were allowed to begin selling a wider range of goods. It also
permitted some private farming on an experimental basis in an effort to boost
agricultural output. In October 2005, the regime reversed some of these policies by
forbidding private sales of grains and reinstituting a centralized food rationing
system. In December 2005, the regime confirmed that it intended to carry out earlier
threats to terminate all international humanitarian assistance operations in the DPRK
(calling instead for developmental assistance only) and to restrict the activities of
international and non-governmental aid organizations such as the World Food
Program. Firm political control remains the Communist government's overriding
concern, which will likely inhibit the loosening of economic regulations.
GDP (purchasing power parity)
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$40 billion
note: North Korea does not publish any reliable National Income Accounts data; the datum shown
here is derived from purchasing power parity (PPP) GDP estimates for North Korea that were made
by Angus Maddison in a study conducted for the OECD; his figure for 1999 was extrapolated to
2005 using estimated real growth rates for North Korea's GDP and an inflation factor based on the
US GDP deflator; the result was rounded to the nearest $10 billion (2005 est.)
Economic indicators (2005)
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GDP (official exchange rate): NA
GDP real growth rate: 1%
GDP per capita (PPP): $1,700
Labor force: 9.6 million
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Unemployment rate: NA
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GDP composition by sector
(2002)
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agriculture: 30%
industry: 34%
services: 36%
Labor force by occupation
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agriculture: 36%
industry and services: 64%
Agriculture products:
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rice
corn
potatoes
soybeans
pulses
cattle
pigs
pork
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eggs
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Main industries:
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military products
machine building
electric power
chemicals
mining (coal, iron ore, magnesite, graphite,
copper, zinc, lead, and precious metals)
metallurgy
textiles
food processing
tourism
Export
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Exports: $1.275 billion FOB (2004)
Exports commodities: minerals, metallurgical
products, manufactures (including armaments),
textiles, fishery products
Exports partners: China 45.6%, South Korea
20.2%, Japan 12.9% (2005)
Import
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Imports: $2.819 billion CIF (2004)
Imports commodities: petroleum, coking coal,
machinery and equipment, textiles, grain
Imports partners: China 32.9%, Thailand
10.7%, Japan 4.8% (2005)
Debt external and economic aid
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Debt external: $12 billion (1996)
Economic aid: approximately 350,000 metric
tons in food aid, worth approximately $118
million, through the World Food Program appeal
in 2004, plus additional aid from bilateral donors
and non-governmental organizations