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((Short description|None)) <!-- This short description is INTENTIONALLY "none" - please see WP:SDNONE before you consider changing it! -->

((About|the economy of Democratic People's Republic of Korea|the Economy of Republic of Korea|Economy of South Korea))

((Use mdy dates|date=June 2022))

((Infobox economy
| country = North Korea
| image = Pyongyang montage.png
| currency = [[North Korean won]] (KPW, ₩)
| year = Calendar year
| organs = 
| group = ((plainlist|
*Low-income economy<ref>((cite web |url=https://datahelpdesk.worldbank.org/knowledgebase/articles/906519-world-bank-country-and-lending-groups |title=World Bank Country and Lending Groups |publisher=[[World Bank]] |website=datahelpdesk.worldbank.org |access-date=September 29, 2019 |archive-date=October 28, 2019 |archive-url=https://web.archive.org/web/20191028223324/https://datahelpdesk.worldbank.org/knowledgebase/articles/906519-world-bank-country-and-lending-groups |url-status=live ))</ref>
*[[command economy]]<ref name="CIAWFKN"/>))
| population = ((increase)) 27,540,000
 (2023)<ref>((cite web |title=Population, total – Korea, Dem. People's Rep. |url=https://data.worldbank.org/indicator/SP.POP.TOTL?locations=KP |publisher=[[World Bank]] |access-date=May 1, 2023 |archive-date=February 27, 2022 |archive-url=https://web.archive.org/web/20220227153353/https://data.worldbank.org/indicator/SP.POP.TOTL?locations=KP |url-status=live ))</ref>
| gdp = ((plainlist|
*$24.5 billion (nominal, 2023)<ref name="cnbc">((cite web|url=https://www.cnbc.com/2017/07/20/north-koreas-economic-growth-climbs-to-17-year-high-in-2016-despite-sanctions-targeting-nuclear-program.html|title=North Korea's 2016 economic growth climbs to 17-year high despite sanctions targeting nuclear program|last=CNBC|website=[[CNBC]]|date=July 20, 2017|access-date=September 9, 2017|archive-date=May 12, 2019|archive-url=https://web.archive.org/web/20190512180448/https://www.cnbc.com/2017/07/20/north-koreas-economic-growth-climbs-to-17-year-high-in-2016-despite-sanctions-targeting-nuclear-program.html|url-status=live))</ref>((refn|group=note|name=bokest|Bank of Korea (South Korea) estimate))
*$~40 billion ([[Purchasing power parity|PPP]], 2023 est.)<ref name="CIAWFKN"/>((refn|group=note|Data are in 2015 US dollars. North Korea does not publish reliable National Income Accounts data; the data shown are derived from purchasing power parity (PPP) GDP estimates that were made by Angus MADDISON in a study conducted for the OECD; his figure for 1999 was extrapolated to 2015 using estimated real growth rates for North Korea's GDP and an inflation factor based on the US GDP deflator; the results were rounded to the nearest $10 billion.<ref name="CIAWFKN"/>))))
| gdp rank = ((plainlist|
*[[List of countries by GDP (nominal)|135th (nominal, 2023)]]
*[[List of countries by GDP (PPP)|136th (PPP, 2023)]]))
| growth = 1.0% (2023)
| per capita = ((plainlist|
*$900 (Nominal, 2023)<ref>((cite news|url=https://www.bloomberg.com/news/articles/2017-07-21/north-korea-s-economy-rebounds-from-drought-amid-missile-focus|title=North Korea's Economy Is Growing at Its Fastest Pace Since 1999|newspaper=Bloomberg |date=July 21, 2017|via=www.bloomberg.com|access-date=July 24, 2017|archive-date=April 18, 2019|archive-url=https://web.archive.org/web/20190418153825/https://www.bloomberg.com/news/articles/2017-07-21/north-korea-s-economy-rebounds-from-drought-amid-missile-focus|url-status=live))</ref>
*$~1,500 (PPP, 2023)<ref name="CIAWFKN"/>((refn|group=note|Data are in 2015 US dollars.))))
| per capita rank = ((plainlist|
*[[List of countries by GDP (nominal) per capita|178th (nominal, 2023)]]
*[[List of countries by GDP (PPP) per capita|180th (PPP, 2023)]]))
| sectors = ((plainlist|
*[[Primary sector of the economy|agriculture]]: 22.5%
*[[Secondary sector of the economy|industry]]: 47.6%
*[[Tertiary sector of the economy|services]]: 29.9%
*(2017 est.)<ref name="CIAWFKN"/>))
| inflation = 
| poverty = ((plainlist|
*50%
*83% on less than $2.15 a day<ref>((cite web |url=https://data.worldbank.org/indicator/SI.POV.DDAY?locations=KP |title=Poverty headcount ratio at $2.15 a day (2017 PPP) (% of population) - Korea, Dem. People's Rep. |publisher=World Bank |website=data.worldbank.org |access-date=20 June 2023 |archive-date=September 24, 2023 |archive-url=https://web.archive.org/web/20230924064843/https://data.worldbank.org/indicator/SI.POV.DDAY?locations=KP |url-status=live ))</ref>))
| hdi = ((plainlist|
*N/A
*N/A [[List of countries by inequality-adjusted HDI|IHDI]]))
| gini = N/A
| labor = ((plainlist|
*((increase)) 18,000,000 (2023)<ref>((cite web |title=Labor force, total – Korea, Dem. People's Rep. |url=https://data.worldbank.org/indicator/SL.TLF.TOTL.IN?locations=KP |website=data.worldbank.org |publisher=World Bank |access-date=April 27, 2020 |archive-date=June 8, 2020 |archive-url=https://web.archive.org/web/20200608184927/https://data.worldbank.org/indicator/SL.TLF.TOTL.IN?locations=KP |url-status=live ))</ref>
*78.2% employment rate (2023)<ref>((cite web |title=Employment to population ratio, 15+, total (%) (modeled ILO estimate) – Korea, Dem. People's Rep. |url=https://data.worldbank.org/indicator/SL.EMP.TOTL.SP.ZS?locations=KP |website=data.worldbank.org |publisher=World Bank & [[International Labour Organization|ILO]] |access-date=April 27, 2020 |archive-date=July 31, 2020 |archive-url=https://web.archive.org/web/20200731205000/https://data.worldbank.org/indicator/SL.EMP.TOTL.SP.ZS?locations=KP |url-status=live ))</ref>((refn|group=note|Modeled [[International Labour Organization|ILO]] estimate))))
| occupations = ((plainlist|
*[[Primary sector of the economy|agriculture]]: 37%
*[[Secondary sector of the economy|industry]]: 63% 
*(2008 est.)<ref name="CIAWFKN"/>))
| unemployment = *((increaseNegative)) 7.7% (2023)<ref>((cite web |title=Unemployment Total (estimate) Korea, Dem. People's Rep. |url=https://data.worldbank.org/country/korea-dem-peoples-rep |publisher=[[World Bank]] |access-date=May 1, 2023 |archive-date=May 25, 2019 |archive-url=https://web.archive.org/web/20190525145838/https://data.worldbank.org/country/korea-dem-peoples-rep |url-status=live ))</ref>
*((decreasePositive)) 6.9% youth unemployment (2021; 15 to 24 year-olds)<ref name="CIAWFKN"/>
| industries = [[Weapons|Military products]], machine building, chemicals, mining (coal, iron ore, limestone, magnesite, graphite, copper, zinc, lead, and precious metals), agriculture, metallurgy, textiles, food processing<ref name="CIAWFKN">((cite web |url=https://www.cia.gov/the-world-factbook/countries/korea-north/ |title=Korea, North |publisher=[[Central Intelligence Agency]] |website=CIA.gov |access-date=April 27, 2020 |archive-date=August 12, 2015 |archive-url=https://web.archive.org/web/20150812052526/https://www.cia.gov/library/publications/the-world-factbook/geos/kn.html |url-status=live ))</ref>
| edbr = N/A
| exports = $4.8 billion (2023)<ref name="CIAWFKN"/>
| export-goods = [[watchmaker|watch components]], [[fake hair]], [[iron alloys]], [[instructional models]], [[tungsten]] (2019)<ref name="CIAWFKN"/>
| export-partners = ((ublist|((flag|China)) 31.2% (2021)<ref name="OEC - North Korea (PRK) Exports, Imports, and Trade Partners">((cite web|url=https://oec.world/en/profile/country/prk|title=OEC – North Korea (PRK) Exports, Imports, and Trade Partners|website=oec.world|access-date=June 24, 2021|archive-date=January 13, 2021|archive-url=https://web.archive.org/web/20210113091430/https://oec.world/en/profile/country/prk))</ref>|((flag|Senegal)) 20.4% (2021)<ref name="OEC   - North Korea (PRK) Exports, Imports, and Trade Partners" />|((flag|Poland)) 5.48% (2021)<ref name="OEC   - North Korea (PRK) Exports, Imports, and Trade Partners" />))
| imports = $4.1 billion (2023)<ref name="CIAWFKN"/>
| import-goods = [[clothing]] and [[apparel]], [[soybean oil]], [[rice]], [[wheat products]], [[clock]]s/[[watch]]es (2019)<ref name="CIAWFKN"/>
| import-partners = ((plainlist|
*((flag|China)) 95.9% (2021)<ref name="OEC   - North Korea (PRK) Exports, Imports, and Trade Partners" />))
| FDI = ((decrease)) $1.878 billion (December 31, 2015, est.)<ref name="CIAWFKN"/>
| gross external debt = $3.1 billion (2023)<ref name="CIAWFKN"/>
| debt = 
| revenue = 3.4 billion (2023)<ref name="CIAWFKN"/>
| expenses = 3.5 billion (2023 est.)<ref name="CIAWFKN"/>
| balance = 1.0% (of GDP) (2023 est.)<ref name="CIAWFKN"/>
| cianame = korea-north
| Exchange rate = 135KPW (per US dollar) (2017 est.)
))

The '''economy of North Korea''' is a [[Central planning|centrally planned economy]], following ''[[Juche]]'', where the role of [[market allocation scheme]]s is limited, although increasing.<ref name=38north-20170406/><ref name=independent-20211216/>  ((As of|2024)), [[North Korea]] continues its basic adherence to a centralized [[planned economy]]. With a total [[gross domestic product]] of $28.500 billion as of 2016, there has been some [[North Korean economic reform|economic liberalization]], particularly after [[Kim Jong Un]] assumed the leadership in 2012, but reports conflict over particular legislation and enactment.<ref name=NYT101512>((cite news|title=North Koreans See Few Gains Below Top Tier |url=https://www.nytimes.com/2012/10/15/world/asia/north-koreans-say-life-has-not-improved.html |access-date=October 15, 2012 |newspaper=[[The New York Times]] |date=October 14, 2012 |author=Andrew Jabobs |url-status=live |archive-url=https://web.archive.org/web/20121015161503/http://www.nytimes.com/2012/10/15/world/asia/north-koreans-say-life-has-not-improved.html |archive-date=October 15, 2012 ))</ref><ref name="frank-20121002">((cite web |url=http://38north.org/2012/10/rfrank100212/ |title=An Atmosphere of Departure and Two Speeds, Korean Style: Where is North Korea Heading? |author=Ruediger Frank |work=[[38 North]] |publisher=School of Advanced International Studies |date=October 2, 2012 |access-date=October 25, 2012 |url-status=dead |archive-url=https://web.archive.org/web/20121024234935/http://38north.org/2012/10/rfrank100212/ |archive-date=October 24, 2012 ))</ref><ref name="baron-20130311"/><ref name="guardian-20140429">((cite news|url=https://www.theguardian.com/world/2014/apr/29/north-korea-capitalism-new-business-elite |title=Capitalism in North Korea: Meet Mr X, one of the new business elite |author=Andrei Lankov |newspaper=The Guardian |date=April 29, 2014 |access-date=July 13, 2014 |url-status=live |archive-url=https://web.archive.org/web/20140714183902/http://www.theguardian.com/world/2014/apr/29/north-korea-capitalism-new-business-elite |archive-date=July 14, 2014 ))</ref><ref name="aljazeera-20140327"/><ref name=38north-20170907/> Since the 1990s, informal market activity has increased, which the government has tolerated.<ref>((Cite journal|last=Yeo|first=Andrew|date=2021|title=State, Society and Markets in North Korea|url=https://www.cambridge.org/core/elements/state-society-and-markets-in-north-korea/FAA574DDE3BC2AD0CF2A1692CF026D6D|journal=Cambridge University Press|language=en|doi=10.1017/9781108888592|isbn=9781108888592|doi-access=free|access-date=September 26, 2021|archive-date=September 26, 2021|archive-url=https://web.archive.org/web/20210926134209/https://www.cambridge.org/core/elements/state-society-and-markets-in-north-korea/FAA574DDE3BC2AD0CF2A1692CF026D6D|url-status=live))</ref> These markets are referred to as '[[Jangmadang]]', and were formed as a result of the economic collapse during the 1990s, which made the regime unable to distribute food to its people.<ref>((Cite web|title=A Changing North Korea|url=https://www.libertyinnorthkorea.org/learn-a-changing-north-korea|access-date=November 11, 2022|archive-date=November 11, 2022|archive-url=https://web.archive.org/web/20221111084501/https://www.libertyinnorthkorea.org/learn-a-changing-north-korea|url-status=live))</ref>

The [[Revolutions of 1989|collapse]] of the [[Eastern Bloc]] from 1989 to 1992, particularly North Korea's principal source of support, the [[Soviet Union]], forced the North Korean economy to realign its foreign economic relations, including increased economic exchanges with South Korea. [[China]] is North Korea's largest trading partner. North Korea's ideology of [[Juche]] has resulted in the country pursuing [[autarky]] in an environment of [[Sanctions against North Korea|international sanctions]].<ref name="Savada1994" /> While the current North Korean economy is still dominated by [[State-owned enterprise|state-owned industry]] and [[Collective farming|collective farms]], foreign investment and corporate autonomy have increased.

North Korea had a similar GDP per capita to its neighbor [[South Korea]] from the aftermath of the [[Korean War]] until the mid-1970s,<ref>Perry, Mark J. (December 21, 2011) [http://www.intellectualtakeout.org/library/chart-graph/institutions-matter-real-capita-gdp-north-and-south-korea Institutions Matter: Real Per Capita GDP in North and South Korea] ((webarchive|url=https://web.archive.org/web/20130726191655/http://intellectualtakeout.org/library/chart-graph/institutions-matter-real-capita-gdp-north-and-south-korea |date=July 26, 2013 )) Intellectual Takeout, Retrieved May 9, 2013</ref><ref>Maddison, Angus "The World Economy A Millennial Perspective", OECD Development Studies Centre, ((ISBN|92-64-02261-9)), (Published 2004), Table A3-c, also available on the Internet at ((cite web |url=http://www.nkeconwatch.com/nk-uploads/theworldeconomy.pdf |title=Archived copy |access-date=May 9, 2013 |url-status=dead |archive-url=https://web.archive.org/web/20120530101557/http://www.nkeconwatch.com/nk-uploads/theworldeconomy.pdf |archive-date=May 30, 2012 )) Retrieved May 8, 2013</ref> but had a [[Gross domestic product|GDP]] per capita of less than $2,000 in the late 1990s and early 21st century. For 2018, the South Korean [[Bank of Korea]] estimated the GDP growth as −4.1%.<ref>((Cite news|date=July 26, 2019|title=Gross Domestic Product Estimates* for North Korea in 2018|work=[[Bank of Korea]]|url=http://www.nkeconwatch.com/nk-uploads/GDP_of_North_Korea_in_2018.pdf|archive-url=https://web.archive.org/web/20200608184927/http://www.nkeconwatch.com/nk-uploads/GDP_of_North_Korea_in_2018.pdf|url-status=dead|archive-date=June 8, 2020|access-date=May 15, 2020))</ref> For the first time, in 2021, the South Korean [[Ministry of Unification]] estimated that the North Korean private sector outgrew the public sector.<ref name=independent-20211216>((Cite news|date=December 16, 2021|title=North Korea's private sector overtakes state for first time under Kim Jong-un|url=https://www.independent.co.uk/asia/east-asia/north-korea-kim-jong-un-private-sector-b1977299.html|access-date=December 17, 2021|website=The Independent|language=en|archive-date=December 16, 2021|archive-url=https://web.archive.org/web/20211216130240/https://www.independent.co.uk/asia/east-asia/north-korea-kim-jong-un-private-sector-b1977299.html|url-status=live))</ref><ref>((Cite web|title=Private sector overtakes state as North Korea's top economic actor under Kim – S.Korea|url=https://wtvbam.com/2021/12/16/private-sector-overtakes-state-as-north-koreas-top-economic-actor-under-kim-s-korea/|access-date=December 17, 2021|website=WTVB ((!)) 1590 AM · 95.5 FM ((!)) The Voice of Branch County|language=en|archive-date=December 16, 2021|archive-url=https://web.archive.org/web/20211216172229/https://wtvbam.com/2021/12/16/private-sector-overtakes-state-as-north-koreas-top-economic-actor-under-kim-s-korea/|url-status=live))</ref><ref>((Cite web|last=Shin|first=Hyonhee|date=December 16, 2021|title=Private sector grows in North Korea|url=https://www.manningrivertimes.com.au/story/7555336/private-sector-grows-in-north-korea/|access-date=December 17, 2021|website=Manning River Times|language=en-AU|archive-date=December 17, 2021|archive-url=https://web.archive.org/web/20211217160015/https://www.manningrivertimes.com.au/story/7555336/private-sector-grows-in-north-korea/|url-status=live))</ref>

==Size of the North Korean economy==
Estimating gross national product in North Korea is a difficult task because of a lack of economic data<ref name="Frank-20120716">((cite web |url=http://38north.org/2012/07/rfrank071612/ |title=A Question of Interpretation: Economic Statistics From and About North Korea |author=Ruediger Frank |work=[[38 North]] |publisher=School of Advanced International Studies |date=July 16, 2012 |access-date=August 3, 2012 |url-status=dead |archive-url=https://web.archive.org/web/20120721144505/http://38north.org/2012/07/rfrank071612/ |archive-date=July 21, 2012 ))</ref> and the problem of choosing an appropriate rate of exchange for the [[North Korean won]], the nonconvertible North Korean currency. The South Korean government's estimate placed North Korea's GNP in 1991 at US$22.9 billion, or US$1,038 per capita. In contrast, South Korea posted US$237.9 billion of GNP and a per capita income of US$5,569 in 1991. North Korea's GNP in 1991 showed a 5.2% decline from 1989, and preliminary indications were that the decline would continue. South Korea's GNP, by contrast, expanded by 9.3% and 8.4%, respectively, in 1990 and 1991.<ref name="Savada1994">((Country study|article=''North Korea: A Country Study''|url=https://archive.org/details/PAM550-81 |author=Savada, Andreas Matles, ed. (1994) |access-date=July 27, 2013))  Washington: Federal Research Division of the Library of Congress. ((ISBN|0-8444-0794-1)).</ref>

It is estimated that North Korea's GNP nearly halved between 1990 and 1999.<ref name="nbr.org"/> North Korean annual budget reports suggest state income roughly tripled between 2000 and 2014.<ref name="38north-20150415">((cite news |url=http://38north.org/2015/04/rfrank041515/ |title=The North Korean Budget Report 2015: Ten Observations |author=Ruediger Frank |publisher=U.S.-Korea Institute, Johns Hopkins University School of Advanced International Studies |work=[[38 North]] |date=April 15, 2015 |access-date=April 30, 2015 |url-status=dead |archive-url=https://web.archive.org/web/20150420054512/http://38north.org/2015/04/rfrank041515/ |archive-date=April 20, 2015 ))</ref> By about 2010, external trade had returned to 1990 levels.<ref name="38north-20151022"/>

The South Korea-based [[Bank of Korea]] estimated that over 2000 to 2013 average growth was 1.4% per year.<ref name="Lankov2015">((cite book|last=Lankov|first=Andrei|title=[[The Real North Korea: Life and Politics in the Failed Stalinist Utopia]]|year=2015|publisher=Oxford University Press|location=Oxford|isbn=978-0-19-939003-8|pages=79,134))</ref> It estimated that the real GDP of North Korea in 2015 was 30,805 billion [[South Korean won]]. It has published the following estimates of North Korea's GDP growth:<ref name=bok-gdp2019>((cite press release |url=https://www.bok.or.kr/viewer/skin/doc.html?fn=202007300329527700.doc&rs=/webview/result/E0000634/202007 |title=Gross Domestic Product Estimates for North Korea in 2019 |publisher=[[Bank of Korea]] |date=July 31, 2020 |access-date=August 17, 2020 |archive-date=October 5, 2020 |archive-url=https://web.archive.org/web/20201005060213/https://www.bok.or.kr/viewer/skin/doc.html?fn=202007300329527700.doc&rs=%2Fwebview%2Fresult%2FE0000634%2F202007 |url-status=live ))</ref>
{| class="wikitable"
|+ GDP growth by year ([[Bank of Korea]] estimate)
! 1990
! 1995
! 1999
! 2000
! 2001
! 2002
! 2003
! 2004
! 2005
! 2006
! 2007
! 2008
! 2009
! 2010
! 2011
! 2012
! 2013
! 2014
! 2015
! 2016
! 2017
! 2018
! 2019
! 2020
|-
| −4.3%
| −4.4%
| 6.1%
| 0.4%
| 3.8%
| 1.2%
| 1.8%
| 2.1%
| 3.8%
| −1.0%
| −1.2%
| 3.1%
| −0.9%
| −0.5%
| 0.8%
| 1.3%
| 1.1%
| 1.0%
| −1.1%
| 3.9%
| −3.5%
| −4.1%
| 0.4%
| −4.5%
|}

This analysis converts production volume estimates into South Korean prices, so is subject to price changes over time of South Korean goods.<ref name=38north-20200806>((cite news |url=https://www.38north.org/2020/08/wbrown080620/ |title=South Korea's Central Bank Report Exaggerates North Korea's Economic Growth |last=Brown |first=William |publisher=The Henry L. Stimson Center |work=[[38 North]] |date=August 6, 2020 |access-date=August 17, 2020 |archive-date=August 16, 2020 |archive-url=https://web.archive.org/web/20200816191617/https://www.38north.org/2020/08/wbrown080620/ |url-status=live ))</ref> According to analyst [[Andrei Lankov]], writing in 2017, a significant number of observers believe that the Bank of Korea is too conservative and the real growth rate is ((nowrap|3–4%.))<ref>((cite news |url=https://www.nknews.org/2017/02/the-limits-of-north-koreas-meagre-economic-growth |title=The limits of North Korea's meager economic growth |first=Andrei |last=Lankov |work=[[NK News]] |date=February 6, 2017 |url-status=dead |archive-url=https://web.archive.org/web/20170226131352/https://www.nknews.org/2017/02/the-limits-of-north-koreas-meagre-economic-growth/ |archive-date=February 26, 2017 |access-date=February 7, 2017 ))</ref><ref name=nyt-20170430/> North Korea reported that the government budget has been increasing at between 5% and 10% annually from 2007 to 2015. Reported planned capital expenditure, mainly on roads and public buildings, increased by 4.3% in 2014, 8.7% in 2015 to 13.7% in 2016.<ref name=38north-20160408>((cite news |url=http://38north.org/2016/04/rfrank040816/ |title=The 2016 North Korean Budget Report: 12 Observations |first=Ruediger |last=Frank |publisher=U.S.-Korea Institute, Johns Hopkins University School of Advanced International Studies |work=[[38 North]] |date=April 8, 2016 |access-date=May 1, 2017 |url-status=dead |archive-url=https://web.archive.org/web/20170504043145/http://38north.org/2016/04/rfrank040816/ |archive-date=May 4, 2017 ))</ref> According to a North Korea economist, the growth rate was 3.7% in 2017, lifting GDP to $29.6 billion in 2018.<ref>((cite news|url=https://english.kyodonews.net/news/2018/10/46a852b7c627-n-koreas-economy-grows-37-in-2017-professor.html|title=North Korea's economy grows 3.7% in 2017: professor|publisher=Kyodo News|date=October 12, 2018|access-date=October 13, 2018|archive-date=April 16, 2019|archive-url=https://web.archive.org/web/20190416052451/https://english.kyodonews.net/news/2018/10/46a852b7c627-n-koreas-economy-grows-37-in-2017-professor.html|url-status=live))</ref> The Australian government estimated 1.3% growth in 2017, while the South Korean government estimated −3.5%.

In 2018, North Korea's [[government budget]] revenue plan overfulfilled 1.4%, an increase of 4.6% over 2017 year.<ref>First meeting of the 14th Supreme People's Assembly of North Korea</ref>

==History==

===Colonial period and post Second World War===
Beginning in the mid-1920s, the [[Government-General of Chosen|Japanese colonial administration]] in Korea concentrated its industrial-development efforts in the comparatively under-populated and resource-rich northern portion of the country, resulting in a considerable movement of people northward from the agrarian southern provinces of the Korean Peninsula.<ref name="Encyclopedia">((cite web|author= Encyclopedia |url= http://eh.net/encyclopedia/article/cha.korea |title= The Economic History of Korea &#124; Economic History Services |publisher= Eh.net |access-date= December 20, 2011 |url-status= dead |archive-url= https://web.archive.org/web/20111212052033/http://eh.net/encyclopedia/article/cha.korea |archive-date= December 12, 2011 ))</ref>

This trend did not reverse until after the end  in 1945 of the [[World War II|Second World War]], when more than 2 million Koreans moved from North to South following the [[division of Korea]] into [[Soviet Civil Administration|Soviet]] and [[United States Army Military Government in Korea|American military]] zones of administration. This southward exodus continued after the establishment of the Democratic People's Republic of Korea (North Korea) in 1948 and during the 1950–53 [[Korean War]].<ref name="Encyclopedia"/> The North Korean [[Demographics of North Korea|population]] as of October 2008 was given((by whom|date=April 2017)) as 24 million.

The post-World War II [[division of Korea|division of the Korean Peninsula]] resulted in imbalances of natural and human resources, with disadvantages for both the North and the South. In 1945, about 80% of Korean [[heavy industry]] was in the North but only 31% of light industry, 37% of agriculture, and 18% of the peninsula's total commerce.<ref name="blogspot1">((cite web|author= Tino |url= http://super-economy.blogspot.com/2010/06/north-korean-economic-history.html |title= Super-Economy: North Korean economic history |publisher= Super-economy.blogspot.com |date= June 27, 2010 |access-date= December 20, 2011 |url-status= dead |archive-url= https://web.archive.org/web/20111016132702/http://super-economy.blogspot.com/2010/06/north-korean-economic-history.html |archive-date= October 16, 2011 |df= mdy ))</ref>

North and South Korea both suffered from the massive destruction caused during the Korean War. Historian [[Charles K. Armstrong]] stated that "North Korea had been virtually destroyed as an industrial society".<ref name=wilsoncenter-20120501>((cite report |url=https://www.wilsoncenter.org/sites/default/files/NKIDP_Working_Paper_4_China_and_the_Postwar_Reconstruction_of_North_Korea.pdf |title=China and the Post-War Reconstruction of North Korea, 1953–1961 |author=Zhihua Shen. Yafeng Xia |publisher=Woodrow Wilson International Center for Scholars |date=May 2012 |access-date=July 15, 2017 |archive-url=https://web.archive.org/web/20170705205556/https://www.wilsoncenter.org/sites/default/files/NKIDP_Working_Paper_4_China_and_the_Postwar_Reconstruction_of_North_Korea.pdf |archive-date=July 5, 2017 |url-status=dead ))</ref> In the years immediately after the war, North Korea mobilized its labour force and natural resources in an effort to achieve rapid economic development. Large amounts of aid from other communist countries, notably the Soviet Union and the People's Republic of China,<ref name=wilsoncenter-20120501/> helped the country achieve a high growth-rate in the immediate [[Post-war|postwar]] period.<ref name="csm-20120801">((cite news|url=http://www.csmonitor.com/World/Asia-Pacific/2012/0801/Inside-North-Korea-more-cellphones-and-traffic-lights-but-real-change-lags |title=Inside North Korea, more cellphones and traffic lights, but real change lags |author=Donald Kirk |newspaper=The Christian Science Monitor |date=August 1, 2012 |access-date=August 1, 2012 |quote=an economy that was, as late as the 1960s, ahead of that of South Korea. |url-status=live |archive-url=https://web.archive.org/web/20120801193750/http://www.csmonitor.com/World/Asia-Pacific/2012/0801/Inside-North-Korea-more-cellphones-and-traffic-lights-but-real-change-lags |archive-date=August 1, 2012 ))
</ref><ref>((cite web 
 |url=http://www.north-korea-travel.com/north-korea-economy.html 
 |title=North Korea Economy&nbsp;— North Korea Information & tours to the DPRK 
 |publisher=North-korea-travel.com 
 |access-date=December 20, 2011 |url-status=dead 
 |archive-url=https://web.archive.org/web/20111226215234/http://www.north-korea-travel.com/north-korea-economy.html 
 |archive-date=December 26, 2011 ))</ref>

===Early efforts at modernization===
[[File:North Korea — Pyongyang (1027715688).jpg|thumb|Exhibition of North Korean industrial goods]]
In 1961, an ambitious seven-year plan was launched to continue industrial expansion and increase living standards, but within three years it became clear this was failing and the plan period was extended to 1970. The failure was due to reduced support from the Soviet Union when North Korea aligned more with China, and military pressure from the U.S. leading to increased defense spending. In 1965, South Korea's rate of economic growth first exceeded North Korea's in most industrial areas, though South Korea's per capita GNP remained lower than North Korea's.<ref name=foia-19670921>((cite web |page=4 |url=https://www.cia.gov/library/readingroom/docs/DOC_0001218147.pdf |title=North Korean Intentions and Capabilities With Respect to South Korea |id=SNIE 14.2–67 |publisher=[[CIA]] |date=September 21, 1967 |archive-url=https://web.archive.org/web/20170314063349/https://www.cia.gov/library/readingroom/docs/DOC_0001218147.pdf |archive-date=March 14, 2017))</ref>

In 1979, North Korea renegotiated much of its international debt, but in 1980 it [[Default (finance)|defaulted]] on its loans except those from Japan. By the end of 1986, [[hard currency|hard-currency]] debt had reached more than US$1 billion. It also owed nearly $2 billion to communist creditors, principally the Soviet Union. The Japanese declared North Korea in default. By 2000, taking into account penalties and accrued interest, North Korea's debt was estimated at $10–12 billion.<ref>((cite web |url=http://www.iacenter.org/Koreafiles/korea_accomp.htm |title=What Korea has accomplished |last=Scahill |first=Tom |date=March 6, 2003 |publisher=[[International Action Center]] |url-status=dead |archive-url=https://web.archive.org/web/20130208182003/http://www.iacenter.org/Koreafiles/korea_accomp.htm |archive-date=February 8, 2013 |access-date=December 29, 2009 ))</ref> By 2012, North Korea's external debt had grown to an estimated US$20 billion despite Russia reportedly writing off about $8 billion of debt in exchange for participation in natural resources development. Besides Russia, major creditors included [[Hungary]], the [[Czech Republic]] and [[Iran]].<ref name="english.chosun.com">((cite web |url=http://english.chosun.com/site/data/html_dir/2012/01/19/2012011900864.html |title=N.Korea Struggling Under Mountains of Foreign Debt |publisher=[[The Chosun Ilbo]] |date=January 19, 2012 |access-date=March 31, 2012 |url-status=dead |archive-url=https://web.archive.org/web/20120221205528/http://english.chosun.com/site/data/html_dir/2012/01/19/2012011900864.html |archive-date=February 21, 2012 ))</ref>

Largely because of these debt problems and because of a prolonged drought and mismanagement, North Korea's industrial growth slowed, and per capita [[gross national product|GNP]] fell below that of the South. By the end of 1979 per capita GNP in North Korea was about one-third of that in the South.<ref name="traveldocs1">((cite web |url=http://www.traveldocs.com/kp/economy.htm |title=North Korea Economy |publisher=Traveldocs.com |access-date=December 20, 2011 |url-status=dead |archive-url=https://web.archive.org/web/20111205121922/http://www.traveldocs.com/kp/economy.htm |archive-date=December 5, 2011 ))</ref> The causes for this relatively poor performance are complex, but a major factor is the disproportionately large percentage of GNP (possibly as much as 25%) that North Korea devotes to the military.

There were minor efforts toward relaxing central control of the economy in the 1980s that involve industrial enterprises. Encouraged by [[Kim Jong Il]]'s call to strengthen the implementation of the independent accounting system (((lang|ko|독립채산제)), ''tongnip ch'aesanje'') of enterprises in March 1984, interest in enterprise management and the independent accounting system increased, as evidenced by increasing coverage of the topic in North Korean journals.<ref name="traveldocs1"/> Under the system, factory managers still are assigned output targets but are given more discretion in decisions about labour, equipment, materials, and funds.<ref name="Savada1994"/>

In addition to fixed capital, each enterprise is allocated a minimum of [[working capital]] from the state through the [[Central Bank of the Democratic People's Republic of Korea|Central Bank]] and is required to meet operating expenses with the proceeds from sales of its output. Up to 50% of the "profit" is taxed, the remaining half being kept by the enterprise for purchase of equipment, introduction of new technology, welfare benefits, and bonuses.<ref>((cite web |url=http://www.nkeconwatch.com/ |title=North Korean Economy Watch |publisher=Nkeconwatch.com |date=December 13, 2011 |access-date=December 20, 2011 |url-status=dead |archive-url=https://web.archive.org/web/20111206221010/http://www.nkeconwatch.com/ |archive-date=December 6, 2011 ))</ref> As such, the system provides some built-in incentives and a degree of micro-level autonomy, unlike the budget allocation system, under which any surplus is turned over to the government in its entirety.<ref name="Savada1994"/>

Another innovation, the August Third People's Consumer Goods Production Movement, is centred on consumer goods production. This measure was so named after Kim Jong Il made an inspection tour of an exhibition of light industrial products held in [[Pyongyang]] on August 3, 1984. The movement charges workers to use locally available resources and production facilities to produce needed consumer goods. On the surface, the movement does not appear to differ much from the local industry programs in existence since the 1960s, although some degree of local autonomy is allowed. However, a major departure places output, pricing, and purchases outside central planning. In addition, direct sales stores were established to distribute goods produced under the movement directly to consumers. The movement is characterized as a third sector in the production of consumer goods, alongside centrally controlled light industry and locally controlled traditional light industry. Moreover, there were some reports in the mid-1980s of increasing encouragement of small-scale private handicrafts and farm markets. ((as of|1992|lc=no)), however, no move was reported to expand the size of private garden plots.<ref name="Savada1994"/>

All these measures appear to be minor stop-gap measures to alleviate severe shortages of consumer goods by infusing some degree of incentives. In mid-1993, no significant moves signalling a fundamental deviation from the existing system had occurred. The reluctance to initiate reform appears to be largely political. This concern is based on the belief that economic reform will produce new interests that will demand political expression and that demands for the institutionalization of such pluralism eventually will lead to political liberalization.<ref name="Savada1994"/>

Beginning in the mid-1980s and particularly around the end of the decade, North Korea slowly began to modify its rigid self-reliant policy. The changes, popularly identified as the open-door policy, included an increasing emphasis on foreign trade, a readiness to accept direct foreign investment by enacting a joint venture law, the decision to open the country to [[international tourism]], and economic cooperation with South Korea.

The main targets of the Third Seven-Year Plan of 1987–1993 were to achieve the "Ten Long-Range Major Goals of the 1980s for the Construction of the Socialist Economy". These goals, conceived in 1980, were to be fulfilled by the end of the decade. The fact that these targets were rolled over to the end of the Third Seven-Year Plan is another indication of the disappointing economic performance during the Second Seven-Year Plan. The three policy goals of self-reliance, modernization, and scientification were repeated. Economic growth was set at 7.9% annually, lower than the previous plan. Although achieving the ten major goals of the 1980s was the main thrust of the Third Seven-Year Plan, some substantial changes have been made in specific quantitative targets. For example, the target for the annual output of steel was reduced by a third: from 15 million tons to 10 million tons. The output targets of cement and non-ferrous metals—two major export items—have been increased significantly. The June 1989 introduction of the Three-Year Plan for Light Industry as part of the Third Seven-Year Plan is intended to boost the [[standard of living]] by addressing consumer needs.<ref name="Savada1994"/>

The Third Seven-Year Plan gave a great deal of attention to developing foreign trade and joint ventures, the first time a plan has addressed these issues. By the end of 1991, however, two years before the termination of the plan, no quantitative plan targets were made public, an indication that the plan has not fared well.((Original research inline|date=January 2008)) The diversion of resources to build highways, theatres, hotels, airports, and other facilities to host the [[13th World Festival of Youth and Students|Thirteenth World Festival of Youth and Students]] in July 1989 must have had a negative impact on industrial and agricultural development, although the expansion and improvement of social infrastructure have resulted in some long-term economic benefits.<ref name="Savada1994"/>

====State Planning Commission====
Although general economic policy objectives are decided by the [[Central Committee of the Workers' Party of Korea|Central People's Committee]] (CPC), it is the task of the State Planning Committee to translate the broad goals into specific annual and long-term development plans and quantitative targets for the economy as a whole, as well as for each industrial sector and enterprise. Under the basic tenets of the 1964 reforms, the planning process is guided by the principles of "unified planning" (((lang|ko|일원화)), ''ilwŏnhwa'') and of "detailed planning" (((lang|ko|새분화)), ''saebunhwa'').<ref name="Savada1994"/>

Under "unified planning", regional committees are established in each province, city, and county to systematically coordinate planning work. These committees do not belong to any regional organization and are directly supervised by the State Planning Committee. As a result of a reorganization in 1969, they are separated into provincial planning committees, city/county committees, and enterprise committees (for large-scale enterprises).<ref name="Savada1994"/>

The planning committees, under the auspices of the State Planning Committee, coordinate their work with the planning offices of the economy-related government organizations the corresponding regional and local areas. The system attempts to enable the regional planning staff to better coordinate with economic establishments in their areas, which are directly responsible to them in planning, as well as communicating directly with staff at the CPC. "Detailed planning" seeks to construct plans with precision and scientific methods based on concrete assessment of the resources, labour, funds, plant capacities, and other necessary information.<ref name="Savada1994"/>

[[File:Nkorea-economic-planning-2.svg|thumb|upright=2|Simplified diagram showing the process of economic policy planning.]]

There are four stages in drafting the final national economic plan.<ref name="Savada1994"/>
* The first is collecting and compiling preliminary statistical data. These figures, which are used as the basic planning data on the productive capacities of economic sectors, originally are prepared by lower-level economic units and aggregated on a national level by respective departments and committees. Simultaneously, the regional, local, and enterprise planning committees prepare their own data and forward them to the CPC. Through this two-channel system of simultaneous, separate, and independent preparation of statistical data by economic units and planning committees, the government seeks to ensure an accurate, objective, and realistic data base unfettered by local and bureaucratic bias.<ref name="Savada1994"/>
* The second stage is preparing the control figures by the CPC based on the preliminary data in accordance with the basic plan goals presented by the Central People's Committee.<ref name="Savada1994"/>
* In the third stage, a draft plan is prepared. The draft plan, prepared by the CPC, is the result of coordinating all draft figures submitted by the lower-level economic units, which, in turn, base their drafts on the control figures handed down from the committee.<ref name="Savada1994"/>
* In the fourth stage, the CPC submits a unified national draft plan to the Central People's Committee and the State Administration Council for confirmation. After approval by the Supreme People's Assembly, the draft becomes final and is distributed to all economic units and regional and local planning committees.<ref name="Savada1994"/>

The plan then becomes legal and compulsory. Frequent directives from the central government contain changes in the plan targets or incentives for meeting the plan objectives.<ref name="Savada1994"/>

Although the central government is most clearly involved in the formulation and evaluation of the yearly and long-term plans, it also reviews summaries of quarterly or monthly progress. Individual enterprises divide the production time into daily, weekly, ten-day, monthly, quarterly, and annual periods. In general, the monthly plan is the basic factory planning period.<ref name="Savada1994"/>

The success of an economic plan depends on the quality and detail of information received, the establishment of realistic targets, coordination among sectors, and correct implementation. High initial growth during the Three-Year Plan and, to a lesser extent, during the Five-Year Plan contributed to a false sense of confidence among the planners. Statistical over reporting—an inherent tendency in an economy where rewards lie in fulfilling the quantitative targets, particularly when the plan target year approaches—leads to overestimation of economic potential, poor product quality, and eventually to plan errors. Inefficient use of plants, equipment, and raw materials add to planning errors. Lack of coordination in planning and production competition among sectors and regions cause imbalances and disrupt input-output relationships. The planning reforms in 1964 were supposed to solve these problems, but the need for correct and detailed planning and strict implementation of plans was so great that their importance was emphasized in the report unveiling the Second Seven-Year Plan, indicating that planning problems persisted in the 1980s.<ref name="Savada1994"/>

In the mid-1990s, North Korea abandoned firm directive planning, and multi-year plans became more of a long-term economic strategy.<ref name="38north-20160726"/><ref name=38north-20200821>((cite news |url=https://www.38north.org/2020/08/nkpartymeetings082120/ |title=Highlights of North Korea's Latest Party Meetings: Setting a New Agenda |publisher=The Henry L. Stimson Center |work=[[38 North]] |date=August 21, 2020 |access-date=August 25, 2020 |quote=For the past five years, the North has not been operating under a five-year "plan," per se, but rather according to what was termed an economic "strategy." |archive-date=August 26, 2020 |archive-url=https://web.archive.org/web/20200826054932/https://www.38north.org/2020/08/nkpartymeetings082120/ |url-status=live ))</ref>

====Ch'ŏngsan-ni Method====
The ''[[Ch'ŏngsan-ni Method]]'' (((lang|ko|청산리방법))) of management was born out of Kim Il Sung's February 1960 visit to the Ch'ŏngsan-ni Cooperative Farm in [[South Pyongan|South P'yŏngan]] Province. Influenced by [[Mao Zedong]]'s Great Leap Forward Policy, Kim and other members of the KWP Central Committee offered "[[on-the-spot guidance]]" (((lang|ko|현지지도)), ''hyŏnji chido'') and spent two months instructing and interacting with the workers. The avowed objective of this new method is to combat "[[Bureaucracy|bureaucratism]]" and "formalism" in the farm management system.<ref name="Savada1994"/>

The leadership claimed that farm workers were unhappy and produced low output because low-ranking functionaries of the [[Workers' Party of Korea]] (who expounded abstract [[Marxism|Marxist]] theories and slogans) were using tactics that failed to motivate. To correct this, the leadership recommended that the workers receive specific guidance in solving production problems and be promised readily available material incentives. The Ch'ŏngsan-ni Method called for high-ranking party officials, party cadres, and administrative officials to emulate [[Kim Il Sung]] by making field inspections. The system provided opportunities for farmers to present their grievances and ideas to leading cadres and managers.<ref name="Savada1994"/>

Perhaps more important than involving administrative personnel in on-site inspections was the increased use of material incentives, such as paid vacations, special bonuses, honorific titles, and monetary rewards. In fact, the Ch'ŏngsan-ni Method appeared to accommodate almost any expedient to spur production. The method, subsequently, was undercut by heavy-handed efforts to increase farm production and amalgamate farms into ever-larger units. Actual improvement in the agricultural sector began with the adoption of the subteam contract system as a means of increasing peasant productivity by adjusting individual incentives to those of the immediate, small working group. Thus the increasing scale of collective farms was somewhat offset by the reduction in the size of the working unit. "On-the-spot guidance" by high government functionaries, however, continued in the early 1990s, as exemplified by Kim Il Sung's visits to such places as the Wangjaesan Cooperative Farm in [[Onsong|Onsŏng County]] and the Kyŏngsŏn Branch Experimental Farm of the Academy of Agricultural Sciences between August 20 and 30, 1991.<ref name="Savada1994"/> Kim Jong Il carried on the tradition, despite having refused to do so before, and even expanded it to the Korean People's Army. Today, Kim Jong Un continues the practices of the method.

====Taean work system====
The [[Industrial organization|industrial management system]] developed in three distinct stages. The first was a period of enterprise autonomy that lasted until December 1946. The second stage was a transitional system based on local autonomy, with each enterprise managed by the enterprise management committee under the direction of the local people's committee. This system was replaced by the "one-man management system" (((lang|ko|지배인 단독 책임제))), with management patterned along Soviet lines as large enterprises were nationalized and came under central control. The third stage, the ''Taean'' Work System (((lang|ko|대안의 사업체계)), ''Taeanŭi saŏpch'e''), was introduced in December 1961 as an application and refinement of agricultural management techniques to industry. The Taean industrial management system grew out of the ''Ch'ŏngsan-ni'' Method.<ref name="Savada1994"/>((rp|123–127))

The highest managerial authority under the Taean system is the party committee. Each committee has approximately 25 to 35 members elected from the ranks of managers, workers, engineers, and the leadership of "working people's organizations" at the factory. A smaller "executive committee", about one-quarter the size of the regular committee, has practical responsibility for day-to-day plant operations and major factory decisions. The most important staff members, including the party committee secretary, factory manager, and chief engineer, make up its membership. The system focuses on co-operation among workers, technicians, and party functionaries at the factory level.<ref name="Savada1994"/>((rp|123–127))

Each factory has two major lines of administration, one headed by the manager, the other by the party committee secretary. A chief engineer and his or her assistants direct a general staff in charge of all aspects of production, planning, and technical guidance. Depending on the size of the factory, varying numbers of deputies oversee factory logistics, marketing, and workers' services. The supply of materials includes securing, storing, and distributing all materials for factory use, as well as storing finished products and shipping them from the factory.<ref name="Savada1994"/>((rp|123–127))

Deputies are assigned workers to their units and handle factory accounts and payroll. Providing workers' services requires directing any farming done on factory lands, stocking factory retail shops, and taking care of all staff amenities. Deputies in charge of workers' services are encouraged to meet as many of the factory's needs as possible using nearby agricultural cooperatives and local industries.<ref name="Savada1994"/>((rp|123–127))

The secretary of the party committee organizes all political activities in each of the factory party cells and attempts to ensure loyalty to the party's production targets and management goals. According to official claims, all management decisions are arrived at by consensus among the members of the party committee. Given the overwhelming importance of the party in the country's affairs, it seems likely that the party secretary has the last say in any major factory disputes.<ref name="Savada1994"/>((rp|123–127))

The Taean system heralded a more rational approach to industrial management than that practised previously. Although party functionaries and workers became more important to management under the new system, engineers and technical staff received more responsibility in areas where their expertise could contribute the most. The system recognizes the importance of material as well as "politico-moral" incentives for managing the factory workers. The "internal accounting system", a spin-off of the "independent accounting system", grants bonuses to work teams and workshops that use raw materials and equipment most efficiently. These financial rewards come out of enterprise profits.<ref name="Savada1994"/>((rp|123–127))

A measure of the success of the Taean work system is its longevity and its continued endorsement by the leadership.<ref name="Savada1994"/>((rp|123–127)) In his 1991 New Year's address marking the 13th anniversary of the creation of the system, Kim Il Sung said that the
<blockquote>
Taean work system is the best system of economic management. It enables the producer masses to fulfill their responsibility and role as masters and to manage the economy in a scientific and rational manner by implementing the mass line in economic management, and by combining party leadership organically with administrative, economic, and technical guidance.<ref name="Savada1994"/>((rp|123–127))</blockquote>

====Mass production campaigns====
Parallel to management techniques such as the Ch'ŏngsan-ni Method and the Taean work system, which were designed to increase output in more normalized and regularized operations of farms and enterprises, the leadership continuously resorts to exhortations and mass campaigns to motivate the workers to meet output targets. The earliest and the most pervasive mass production campaign was the [[Chollima Movement|Ch'ŏllima Movement]]. Introduced in 1958 and fashioned after China's [[Great Leap Forward]] (1958–1960), the Ch'ŏllima Movement organized the labour force into work teams and brigades to compete at increasing production. The campaign was aimed at industrial and agricultural workers and at organizations in education, science, sanitation and health, and culture.<ref name="Savada1994"/>((rp|123–127))

In addition to work teams, units eligible for Ch'ŏllima citations included entire factories, factory workshops, and such self-contained units as a ship or a railroad station. The "[[socialist emulation]]" among the industrial sectors, enterprises, farms, and work teams under the Ch'ŏllima Movement frantically sought to complete the [[First Five-Year Plan (North Korea)|First Five-Year Plan]] (1957–1960) but instead created chaotic disruptions in the economy. This made it necessary to set aside 1959 as a "buffer year" to restore balance in the economy.<ref name="Savada1994"/>((rp|123–127))

Although the Ch'ŏllima Movement was replaced in the early 1960s by the Ch'ŏngsan-ni Method and the Taean Work System, the regime's reliance on mass campaigns continued into the early 1990s. Campaigns conducted after the Ch'ŏllima to speed battles toward the end of a period (such as a month, a year, or an economic plan) to reach production targets to carry out the economic goals of the decade.<ref name="Savada1994"/>((rp|123–127))

===Efforts at modernization since 1991===
Following the [[collapse of the Soviet Union]] in 1991, the principal source of external support, North Korea announced in December 1993 a three-year transitional economic policy placing primary emphasis on agriculture, light industry, and foreign trade. However, lack of fertilizer, natural disasters, and poor storage and transportation practices caused the country to fall more than a million tons per year short of grain self-sufficiency.<ref name=Bloomberg2016 /><ref name=UPI2016 /> Moreover, lack of foreign exchange to purchase spare parts and oil for [[electricity generation]] left many factories idle.<ref name=RandPark2010Dissertation />

The shortage of foreign exchange because of a chronic trade deficit, a large foreign debt, and dwindling foreign aid has constrained economic development. In addition, North Korea has been diverting scarce resources from developmental projects to defence; it spent more than 20% of GNP on defence toward the end of the 1980s, a proportion among the highest in the world. These negative factors, compounded by the declining efficiency of the central planning system and the failure to modernize the economy, have slowed the pace of growth since the 1960s. The demise of the [[socialist republic]]s in the Soviet Union and East European countries—North Korea's traditional trade partners and benefactors—has compounded the economic difficulties in the early 1990s.<ref name="Savada1994"/>

Economically, the collapse of the Soviet Union and the end of Soviet support to North Korean industries caused a contraction of the North Korea's economy by 25% during the 1990s. While, by some accounts, North Korea had a higher per capita income than South Korea in the 1970s, by 2006 its per capita income was estimated to be only $1108, one seventeenth that of South Korea.<ref>Amal Mattoo, ''Power, Ideology, and Resistance to Reform in North Korea'' (May 2015): 3.</ref>

Experimentation in small scale entrepreneurship took place from 2009 to 2013, and although there continue to be legal uncertainties this has developed into a significant sector.<ref name="38north-20170329">((cite news|url=http://38north.org/2017/03/aabrahamian032917/|title=A Eulogy to Women in Business Training|last=Abrahamian|first=Andray|date=March 29, 2017|work=[[38 North]]|access-date=April 18, 2017|archive-url=https://web.archive.org/web/20170419102256/http://38north.org/2017/03/aabrahamian032917/|archive-date=April 19, 2017|url-status=dead|publisher=U.S.–Korea Institute, Johns Hopkins University School of Advanced International Studies))</ref> By 2016 economic liberalisation had progressed to the extent that both locally-responsible and state industrial enterprises gave the state 20% to 50% of their output, selling the remainder to buy raw materials at market-based prices akin to a free market.<ref name="38north-20160726">((cite news |url=http://38north.org/2016/07/gtoloraya072616/ |title=Deciphering North Korean Economic Policy Intentions |author=Georgy Toloraya |publisher=U.S.-Korea Institute, Johns Hopkins University School of Advanced International Studies |work=[[38 North]] |date=July 26, 2016 |access-date=August 4, 2016 |url-status=dead |archive-url=https://web.archive.org/web/20160730061744/http://38north.org/2016/07/gtoloraya072616/ |archive-date=July 30, 2016 ))</ref>

In 2014, the Enterprise Act was amended to allow state-owned enterprise managers to engage in foreign trade and joint ventures, and to accept investment from non-government domestic sources.  Under the new rules the enterprise director became more like the western [[chief executive officer]], and the chief engineer had an operational role more like a western [[chief operating officer]]. As of 2017 it was unclear if the Taean Work System (described above) still in practice operated to give local people's committees much influence.<ref name=38north-20171221>((cite news |url=https://www.38north.org/2017/12/pward122117/ |title=Market Reforms with North Korean Characteristics: Loosening the Grip on State-Owned Enterprises |last=Ward |first=Peter |publisher=U.S.-Korea Institute, Johns Hopkins University School of Advanced International Studies |work=[[38 North]] |date=December 21, 2017 |access-date=March 5, 2018 |archive-date=March 6, 2018 |archive-url=https://web.archive.org/web/20180306023133/https://www.38north.org/2017/12/pward122117/ |url-status=live ))</ref>

In 2017, Dr. Mitsuhiro Mimura, Senior Research Fellow at Japan's Economic Research Institute for Northeast Asia, who has visited North Korea 45 times, described it as the "poorest advanced economy in the world", in that while having comparatively low GDP, it had built a sophisticated production environment. He described the recent rise of entrepreneurial groups through "socialist cooperation", where groups of individuals could start small enterprises as cooperative groups. Managers in state-owned industries or farms were also free to sell or trade production beyond state plan targets, providing incentives to increase production. Managers could also find investment for expansion of successful operations, in a process he called "socialist competition". A state plan was still the basis for production, but was more realistic leaving room for excess production.<ref name=38north-20170907>((cite news |url=http://www.38north.org/2017/09/jbaron090717/ |title=What if Sanctions Brought North Korea to the Brink? "Well, in 1941..." |last=Baron |first=Jeff |publisher=U.S.-Korea Institute, Johns Hopkins University School of Advanced International Studies |work=[[38 North]] |date=September 7, 2017 |access-date=September 11, 2017 |archive-date=September 8, 2019 |archive-url=https://web.archive.org/web/20190908041008/https://www.38north.org/2017/09/jbaron090717/ |url-status=live ))</ref>

===Budget and finance===
[[File:Two koreas gdp 1950 1977.jpg|thumb|upright=1.8|Comparison of the [[GDP per capita]] trends of two Koreas from 1950 to 1977 (in 1990 [[international dollar]]s)]]
[[File:Economic growth of North Korea.jpg|thumb|Historical GDP per capita estimates of North Korea]]
The state budget is a major government instrument in carrying out the country's economic goals.<ref name=loc>((cite web|url=https://www.loc.gov/item/2008028547/ |title=North Korea : a country study / |work=The Library of Congress |url-status=live |archive-url=https://web.archive.org/web/20160411145543/https://www.loc.gov/item/2008028547/ |archive-date=April 11, 2016 ))</ref> Expenditures represented about three-quarters of GNP in the mid-1980s, the allocation of which reflected the priorities assigned to different economic sectors.<ref name=loc/> Taxes were abolished in 1974 as "remnants of an antiquated society". This action, however, was not expected to have any significant effect on state revenue because the overwhelming proportion of government funds—an average of 98.1% during 1961–1970—was from turnover (sales) taxes, deductions from profits paid by state enterprises, and various user fees on machinery and equipment, irrigation facilities, television sets, and water.<ref name=loc/>

In order to provide a certain degree of local autonomy as well as to lessen the financial burden of the central government, a "local budget system" was introduced in 1973. Under this system, provincial authorities are responsible for the operating costs of institutions and enterprises not under direct central government control, such as schools, hospitals, shops, and local consumer goods production. In return, they are expected to organize as many profitable ventures as possible and to turn over profits to the central government.<ref name="Savada1994"/>

Around December of every year, the state budget for the following calendar year is drafted, subject to revision around March. Typically, total revenue exceeds expenditure by a small margin, with the surplus carried over to the following year. The largest share of state expenditures goes to the "people's economy", which averaged 67.3% of total expenditures between 1987 and 1990, followed in magnitude by "socio-cultural", "defense", and "administration".<ref name="Savada1994"/>

Defense spending, as a share of total expenditures, has increased significantly since the 1960s: from 3.7% in 1959 to 19% in 1960, and, after averaging 19.8% between 1961 and 1966, to 30.4% in 1967. After remaining around 30% until 1971, the defense share decreased abruptly to 17% in 1972, and continued to decline throughout the 1980s. Officially, in both 1989 and 1990 the defense share remained at 12%, and for 1991 it was 12.3% with 11.6% planned for 1992. The declining trend was consistent with the government's announced intentions to stimulate economic development and increase the social benefits. However, Western experts have estimated that actual military expenditures are higher than budget figures indicate.<ref name="Savada1994"/>

In the 1999 budget, expenditures for the farming and power sectors were increased by 15% and 11%, respectively, compared with those of 1998.

In the 2007 budget, it was estimated an increase in revenue at 433.2bn won ($3.072bn, $1 = 141 won). In 2006, 5.9% were considered the public revenue, whereas this year, this figure was raised to 7.1%.

North Korea claims that it is the only state in the world that does not levy [[tax]]es. Taxes were abolished beginning on April 1, 1974.<ref>[http://www.uriminzokkiri.com/Newspaper/english/2006/2006-04-08-A1.htm Tax-free land] ((webarchive |url=https://web.archive.org/web/20110716101235/http://www.uriminzokkiri.com/Newspaper/english/2006/2006-04-08-A1.htm |date=July 16, 2011 )). ''Uriminzokkiri''. April 8, 2006.</ref>

===Bonds===
Since 2003, North Korean authorities issue [[government bond]]s called The "People's Life Bonds",<ref>((Cite web |title=Report: Struggling N. Korea launches bond issue |url=https://secure.marketwatch.com/story/report-struggling-n-korea-launches-bond-issue |access-date=June 21, 2015 |first=Allen |last=Wan |url-status=dead |archive-url=https://web.archive.org/web/20150621211245/https://secure.marketwatch.com/story/report-struggling-n-korea-launches-bond-issue |archive-date=June 21, 2015 ))</ref> and promoted the slogan "Buying bonds is [[Patriotism|patriotic]]".

North Korea sold bonds internationally in the late 1970s for 680 million [[Deutsche mark]]s and 455 million [[Swiss franc]]s. North Korea [[default (finance)|defaulted]] on these bonds by 1984, although the bonds remain traded internationally on speculation that the country would eventually perform on the obligations.<ref name="reuters-bonds">((cite news|author=Encyclopedia|url=https://www.wsj.com/articles/SB10001424052970204464404577114961074711158|title=North Korean Bonds? Now Could Be the Time|newspaper=[[The Wall Street Journal]]|access-date=May 23, 2012|archive-date=December 17, 2014|archive-url=https://web.archive.org/web/20141217082701/http://www.wsj.com/articles/SB10001424052970204464404577114961074711158|url-status=live))</ref>

===The latest trends===
((see also|Byungjin))
''[[The Sydney Morning Herald]]'' reported that [[Kim Jong-un|Kim]]'s previous propaganda has shifted focus toward [[patriotism]] and the economy, and improving its relationships with China, South Korea, and the United States. The state-run television promoted a song of praise to the National flag by airing videos with images that included the flag being raised September 2018, during mass games events, marking North Korea's 70th anniversary. In the video, brief images of troops, fighter jets releasing blue, red, and white smoke, scattered pictures of civilians, new high-rise apartments in the capital, fireworks displays, and even students in their school uniforms can all be seen at the same event.<ref>((cite web |url=https://www.smh.com.au/world/asia/flagging-prosperity-north-korea-moves-on-from-displays-of-force-20190208-p50wjl.html |title=Flagging prosperity: North Korea moves on from displays of force |website=[[The Sydney Morning Herald]] |date=February 8, 2019 |access-date=February 28, 2019 |archive-date=February 28, 2019 |archive-url=https://web.archive.org/web/20190228065805/https://www.smh.com.au/world/asia/flagging-prosperity-north-korea-moves-on-from-displays-of-force-20190208-p50wjl.html |url-status=live ))</ref>

The ''[[South China Morning Post]]'', in a 2019 article, stated that already there is also some economical and cultural revolution happening recently within North Korea itself. It started in earnest in February 2018, during the [[2018 Winter Olympics|Pyeongchang Winter Olympic Games]], when top musicians from North Korea were sent to perform in South Korea. This included a female quintet who performed in black shorts and red tops. After two months, Supreme Leader Kim Jong Un saw the performance of South Korean girl group, [[Red Velvet (group)|Red Velvet]]. This is the first ever [[K-pop]] show to be held in Pyongyang. The North Korean musicians that performed in South Korea were highly praised for their performance that leader Kim decided to send them to Beijing for another goodwill tour in January 2019. Part of the revolution was the introduction of other cultures, including Western, which was previously believed to be vulgar and quite corrupt in the past, but is now slowly making its way to the North Korean people. Second-hand [[Harry Potter]] books can now be read at the National Library, and [[Bollywood|Bollywood films]] like the ''[[Three Idiots]]'' had just had a run in their cinemas. The changes have also found their way to the economic sector with factories that are also producing products that are associated more with the West, like [[Air Jordan|Air Jordan shoes]], for national consumption.
<ref>((cite web |url= https://www.scmp.com/culture/music/article/2185987/harry-potter-bollywood-hot-pants-and-k-pop-north-korea-kim-jong-uns |title= Harry Potter, Bollywood, hot pants and K-pop: in North Korea, Kim Jong-un's cultural revolution gathers speed |website= South China Morning Post |date= February 14, 2019 |access-date= February 28, 2019 |archive-date= February 28, 2019 |archive-url= https://web.archive.org/web/20190228015432/https://www.scmp.com/culture/music/article/2185987/harry-potter-bollywood-hot-pants-and-k-pop-north-korea-kim-jong-uns |url-status= live ))</ref>

Per the amendments made to the Constitution in 2019, the former economic methods of management, Ch'ŏngsan-ni in agriculture and Taean in the industries, were now phased out altogether.

After the 8th Party Congress, Kim Byung-yeon of the Seoul National University said that, between 2017 and 2019, the North Korean GDP decreased by 10% and, in 2020, the North Korean GDP decreased by 5%.

==Economic sectors==

===Manufacturing===
[[File:Fábrica máquinas-herramienta Huichón (5).jpg|thumb|Tool-machine factory in [[Huichon]]]]

North Korea also implements planned economy in industry. The government will provide fuel and materials for a factory, while the factory will manufacture products and quantities according to the government's requirements.

North Korea's self-reliant development strategy assigned top priority to developing heavy industry, with parallel development in agriculture and light industry. This policy was achieved mainly by giving heavy industry preferential allocation of state investment funds. More than 50% of state investment went to the industrial sector during the 1954–1976 period (47.6%, 51.3%, 57.0%, and 49.0%, respectively, during the [[Three-Year Plan]], Five-Year Plan, First Seven-Year Plan, and Six-Year Plan). As a result, gross industrial output grew rapidly.<ref name="Savada1994" />((rp|123–127))

As was the case with the growth in national output, the pace of growth has slowed markedly since the 1960s. The rate declined from 41.7% and 36.6% a year during the Three-Year Plan and Five-Year Plan, respectively, to 12.8%, 16.3%, and 12.2%, respectively, during the First Seven Year Plan, Six-Year Plan, and Second Seven-Year Plan. As a result of faster growth in industry, that sector's share in total national output increased from 16.8% in 1946 to 57.3% in 1970. Since the 1970s, industry's share in national output has remained relatively stable. From all indications, the pace of industrialization during the Third Seven-Year Plan up to 1991 is far below the planned rate of 9.6%. In 1990 it was estimated that the industrial sector's share of national output was 56%.<ref name="Savada1994"/>((rp|123–127))

Industry's share of the combined total of gross agricultural and industrial output climbed from 28% in 1946 to well over 90% in 1980. Heavy industry received more than 80% of the total state investment in industry between 1954 and 1976 (81.1%, 82.6%, 80%, and 83%, respectively, during the [[Three-Year Plan]], Five-Year Plan, First Seven-Year Plan, and Six-Year Plan), and was overwhelmingly favored over light industry.<ref name="Savada1994"/>

North Korea claims to have fulfilled the Second Seven-Year Plan (1978–1984) target of raising the industrial output in 1984 to 120% of the 1977 target, equivalent to an average annual growth rate of 12.2%. Judging from the production of major commodities that form the greater part of industrial output, however, it is unlikely that this happened. For example, the increase during the 1978–1984 plan period for electric power, coal, steel, metal-cutting machines, tractors, passenger cars, chemical fertilizers, chemical fibers, cement, and textiles, respectively, was 78%, 50%, 85%, 67%, 50%, 20%, 56%, 80%, 78%, and 45%.<ref name="Savada1994"/>((rp|123–127))
Raw materials were in short supply and so were energy and hard currency. Infrastructure decayed and machinery became obsolete. Unlike other [[Eastern Bloc|socialist countries in the Eastern Europe]], North Korea kept planning in a highly centralized manner and refused to liberalize economic management.

[[File:Fabrica de cristal duro Huichon4.jpg|left|thumb|[[Huichon#Huichon Hard Glassware Factory|Huichon Hard Glass Factory]]]]
In the mid-1980s, the speculation that North Korea would emulate China in establishing Chinese-style [[special economic zone]]s was flatly denied by then deputy chairman of the Economic Policy Commission [[Yun Ki-pok]] (Yun became chairman as of June 1989). China's special economic zones typically are coastal areas established to promote economic development and the introduction of advanced technology through [[Foreign direct investment|foreign investment]]. Investors are offered preferential tax terms and facilities. The zones, which allow greater reliance on market forces, have more decision-making power in economic activities than do provincial-level units. Over the years, China has tried to convince the North Korean leadership of the advantages of these zones by giving tours of the various zones and explaining their values to visiting high-level officials.<ref name="Savada1994"/>

In April 1982, [[Kim Il Sung]] announced a new economic policy giving priority to increased agricultural production through [[land reclamation]], development of the country's infrastructure—especially power plants and transportation facilities—and reliance on domestically produced equipment. There also was more emphasis on trade.

In September 1984, North Korea promulgated a [[joint venture]] law to attract foreign [[Capital (economics)|capital]] and [[technology]]. The new emphasis on expanding [[trade]] and acquiring technology was not, however, accompanied by a shift in priorities away from support of the military. In 1991, North Korea announced the creation of a Special Economic Zone (SEZ) in the northeast regions of [[Rason]] ([[Rason Special Economic Zone]]) and [[Chongjin|Ch'ŏngjin]]. Investment in this SEZ has been slow in coming. Problems with [[infrastructure]], [[bureaucracy]], uncertainties about the security of investments, and viability have hindered growth and development. Nevertheless, thousands of small Chinese businesses had set up profitable operations in North Korea by 2011.<ref name="bbc-20111220">((cite news|url=https://www.bbc.co.uk/news/business-16254565 |title=Kim's death and the North Korean economy |author=Tony Michell |publisher=BBC |date=December 20, 2011 |access-date=April 10, 2012 |url-status=live |archive-url=https://web.archive.org/web/20120425011744/http://www.bbc.co.uk/news/business-16254565 |archive-date=April 25, 2012 ))</ref>

A government research center, the [[Korea Computer Center]], was set up in 1990, starting the slow development of an [[information technology]] industry.<ref>((cite web |url=http://38north.org/2011/10/ptjia102611/ |title=North Korea: An Up-and-Coming IT-Outsourcing Destination |author=Paul Tjia |date=November 18, 2011 |work=[[38 North]], [[School of Advanced International Studies]] |publisher=Johns Hopkins University |access-date=November 18, 2011 |url-status=dead |archive-url=https://web.archive.org/web/20111130005525/http://38north.org/2011/10/ptjia102611/ |archive-date=November 30, 2011 ))</ref>

In 2013 and 2014, the [[State Economic Development Administration]] announced a number of smaller special economic zones covering export handling, mineral processing, high technology, gaming and tourism.<ref name="tribune-20141217">((cite news |url=http://www.tribunemagazine.org/2014/12/pyongyang-shows-signs-of-change/ |title=Pyongyang shows signs of change |author=Glyn Ford |newspaper=Tribune |date=December 17, 2014 |access-date=December 20, 2014 |archive-url=https://web.archive.org/web/20141220180930/http://www.tribunemagazine.org/2014/12/pyongyang-shows-signs-of-change/ |archive-date=December 20, 2014 |url-status=dead |author-link=Glyn Ford ))</ref> International conferences on special economic zones took place in 2013 and 2014, and the concept of many provincial economic zones was considered. However from 2019 these possibilities have diminished, partly out of a concern of excessive foreign influence on North Korean society.<ref name=38north-20221221>((cite web |url=https://www.38north.org/2022/12/understanding-kim-jong-uns-economic-policymaking-rolling-out-economic-development-zones/ |title=Understanding Kim Jong Un's Economic Policymaking: Rolling Out Economic Development Zones |last1=Carlin |first1=Robert |last2=Minyoung |first2=Rachel Lee |publisher=The Henry L. Stimson Center |work=[[38 North]] |date=21 December 2022 |access-date=10 January 2023 |archive-date=January 10, 2023 |archive-url=https://web.archive.org/web/20230110132314/https://www.38north.org/2022/12/understanding-kim-jong-uns-economic-policymaking-rolling-out-economic-development-zones/ |url-status=live ))</ref>

====Garment industry====
The most successful export industry is the [[Clothing industry|garment industry]]. Production is by a North Korean firm for a European or other foreign partner, by a Chinese firm operating in North Korea with a North Korean partner, or by North Korean workers working in Chinese or other foreign factories.<ref>((Cite web |url=https://www.nknews.org/2015/01/twelve-north-koreans-to-work-in-factory-in-europe/ |title=Twelve North Koreans to work in factory in Europe |date=January 14, 2015 |website=[[NK News]] |access-date=August 9, 2016 |url-status=dead |archive-url=https://web.archive.org/web/20160719100526/https://www.nknews.org/2015/01/twelve-north-koreans-to-work-in-factory-in-europe/ |archive-date=July 19, 2016 ))</ref><ref>((Cite web|url=http://www.channel4.com/info/press/news/brexit-who-ll-do-your-job-now-channel-4-dispatches |title=Brexit: Who'll Do Your Job Now? |date=August 7, 2016 |website=Channel 4 Dispatches – Channel 4 – Info – Press |publisher=Channel 4 UK TV |access-date=August 9, 2016 |url-status=live |archive-url=https://web.archive.org/web/20160819120332/http://www.channel4.com/info/press/news/brexit-who-ll-do-your-job-now-channel-4-dispatches |archive-date=August 19, 2016 ))</ref> Wages are the lowest in northeastern Asia.<ref name=38N83012>((cite web |title=Garment Production in North Korea |url=http://38north.org/2012/08/tjia082912/ |publisher=[[38 North]].Org, The U.S.-Korea Institute (USKI) at SAIS, Paul H. Nitze School of Advanced International Studies (SAIS), Johns Hopkins University |access-date=September 26, 2012 |author=Paul Tjia |date=August 30, 2012 |url-status=dead |archive-url=https://web.archive.org/web/20120926083556/http://38north.org/2012/08/tjia082912/ |archive-date=September 26, 2012 ))</ref>

====Automotive industry====
[[File:Pyongyang bus.jpg|thumb|A North Korean manufactured trolleybus, a Chollima 90]]
((Main|Automotive industry in North Korea))
The North Korean motor vehicle production establishes military, industrial and construction goals, with private car ownership by citizens remaining on low demand. Having Soviet origins (the subsequent practice of cloning foreign specimens, and a recent automobile joint-venture), North Korea has developed a wide-range automotive industry with production of all types of vehicles. The basis for production is in urban and off-road minis; luxury cars; SUV cars; small, medium, heavy, and super-heavy cargo; construction and off-road trucks; minibuses/minivans, coach buses, civilian and articulated buses, trolleybuses, and trams. However, North Korea produces far fewer vehicles than its production capability due to the ongoing economic crisis. North Korea has not joined or collaborated with the [[Organisation Internationale des Constructeurs d'Automobiles|OICA]], or with any other automotive organization, so any critical information about its motor vehicle industry is limited.

===Power and energy===
((Main|Energy in North Korea))[[File:Electrical engineering components.jpg|left|upright|thumb|Electrical engineering components]]
The energy sector is one of the most serious bottlenecks in the North Korean economy. Since 1990, the supply of oil, coal, and electricity declined steadily, and seriously affected all sectors of the economy. [[Crude oil]] was formerly imported by pipeline at "friendship prices" from the former Soviet Union or China, but the withdrawal of Russian concessions and the reduction of imports from China brought down annual imports from about ((convert|23|Moilbbl)) in 1988 to less than ((convert|4|Moilbbl)) by 1997. As the imported oil was refined for fuels for transportation and agricultural machinery, a serious cutback in oil imports caused critical problems in transportation and agriculture.

According to statistics compiled by the South Korean agency Statistics Korea based on [[International Energy Agency]] (IEA) data, per capita electricity consumption fell from its peak in 1990 of 1247 kilowatt hours to a low of 712 kilowatt hours in 2000. It slowly rose since then to 819 kilowatt hours in 2008, a level below that of 1970.<ref name=DNK8612>((cite news |title=Economic Collapse Reflected in Scarce Electricity |url=http://www.dailynk.com/english/read.php?cataId=nk00100&num=9629 |access-date=August 6, 2012 |newspaper=[[Daily NK]] |date=August 6, 2012 |author=Kim Tae Hong |url-status=dead |archive-url=https://web.archive.org/web/20120904031624/http://www.dailynk.com/english/read.php?cataId=nk00100&num=9629 |archive-date=September 4, 2012 ))</ref><ref name=YN8612>((cite news|title=N. Korea's power consumption per capita at 1970s levels |url=http://english.yonhapnews.co.kr/news/2012/08/06/0200000000AEN20120806003300315.HTML |access-date=August 6, 2012 |newspaper=[[Yonhap News Agency]] |date=August 6, 2012 |agency=Yonhap |url-status=live |archive-url=https://web.archive.org/web/20141022150718/http://english.yonhapnews.co.kr/news/2012/08/06/0200000000AEN20120806003300315.HTML |archive-date=October 22, 2014 ))</ref>

North Korea has no [[Coke (fuel)|coking coal]], but has substantial reserves of [[anthracite]] in [[Anju (city)|Anju]], Aoji ([[Undok|Ŭndŏk]]), and other areas. Coal production peaked at 43 million tons in 1989 and steadily declined to 18.6 million tons in 1998. Major causes of coal shortages include [[mine flooding]], and outdated mining technology. As coal was used mainly for industry and electricity generation, decrease in coal production caused serious problems in industrial production and electricity generation. Coal production may not necessarily increase significantly until North Korea imports modern mining technology.((Original research inline|date=January 2008))

Electricity generation of North Korea peaked in 1989 at about 30 TWh. There were seven large hydroelectric plants in the 1980s. Four were along the [[Yalu River]], built with Chinese aid, and supplying power to both countries. In 1989, 60% of electricity generation was [[hydroelectricity|hydroelectric]] and 40% fossil fueled, mostly coal-fired.

In 1997, coal accounted for more than 80% of primary energy consumption and hydro power more than 10%.((Citation needed|date=September 2021)) Net imports of coal represented only about 3% of coal consumption. Hydroelectric power plants generated about 55% of North Korea's electricity and coal-fired thermal plants about 39% in 1997.<ref name="Electricity production from coal sources (% of total) - Korea, Dem. People's Rep.">((cite web|url=https://data.worldbank.org/indicator/EG.ELC.COAL.ZS?locations=KP|title=Electricity production from coal sources (% of total) – Korea, Dem. People's Rep.|publisher=World Bank|access-date=September 26, 2021|archive-date=September 26, 2021|archive-url=https://web.archive.org/web/20210926063033/https://data.worldbank.org/indicator/EG.ELC.COAL.ZS?locations=KP|url-status=live))</ref><ref name="Electricity production from hydroelectric sources (% of total) - Korea, Dem. People's Rep.">((cite web|url=https://data.worldbank.org/indicator/EG.ELC.HYDRO.ZS?locations=KP|title=Electricity production from hydroelectric sources (% of total) – Korea, Dem. People's Rep.|publisher=World Bank|access-date=September 26, 2021|archive-date=September 26, 2021|archive-url=https://web.archive.org/web/20210926071338/https://data.worldbank.org/indicator/EG.ELC.HYDRO.ZS?locations=KP|url-status=live))</ref> However, with only 20% of the per capita electricity generation of Japan, North Korea suffered from chronic supply shortages. Coal exports to China accounted for a major portion of North Korea's revenue in mid-2010s.<ref name=CoalDiplomacy>((cite web |url=http://gregpavone.com/dprk-coal |publisher=Harvard Kennedy School |date=March 2014 |first=Gregory |last=Pavone |title=Coal Diplomacy: The Political Economy of North Korean Coal |url-status=dead |archive-url=https://web.archive.org/web/20150904004856/http://gregpavone.com/dprk-coal |archive-date=September 4, 2015 |access-date=May 25, 2015 ))</ref>

Some hydroelectric facilities were believed to be out of operation due to damage from major flooding in 1995. Coal-fired power plants were running well under capacity, due in part to a serious decline in coal supply and in part to problems with transportation of coal. The electricity supply steadily declined and was 17 TWh in 1998.((Citation needed|date=December 2021)) Transmission losses sit at just under 16% (15.8%) as of 2014.<ref name="Electric power transmission and distribution losses (% of output) - Korea, Dem. People's Rep.">((cite web|url=https://data.worldbank.org/indicator/EG.ELC.LOSS.ZS?locations=KP|title=Electric power transmission and distribution losses (% of output) – Korea, Dem. People's Rep.|publisher=World Bank|access-date=September 26, 2021|archive-date=September 26, 2021|archive-url=https://web.archive.org/web/20210926063031/https://data.worldbank.org/indicator/EG.ELC.LOSS.ZS?locations=KP|url-status=live))</ref>

===Construction===
[[File:PYONGYANG CITY DPRK NORTH KOREA OCT 2012 (8647588769).jpg|thumb|Mansudae People's Theatre, opened in 2012]]
Construction has been an active sector in North Korea. This was demonstrated not only through large housing programmes, of which most were visible in the high-rise apartment blocks in [[Pyongyang]], but also in the smaller modern apartment complexes widespread even in the countryside. These are dwarfed in every sense by "grand monumental edifices". The same may apply even to apparently economically useful projects such as the [[Nampo Dam]], which cost US$4bn.<ref>((Cite book|title=Korea North Country Study Guide Volume 1 Strategic Information and Developments|publisher=International Business Publications, USA|isbn=978-1433027802|pages=187|date=April 13, 2015))</ref>

The years of economic contraction in the 1990s slowed this sector as it did others; the shell of the 105-story [[Ryugyŏng Hotel]] towered unfinished on [[Pyongyang]]'s skyline for over a decade. The [[Bank of Korea]] claims that construction's share of GDP fell by almost one-third between 1992 and 1994, from 9.1% to 6.3%. This accords with a rare official figure((Citation needed|date=January 2008)) of 6% for 1993, when the sector was said to have employed 4.2% of the labour force. However, the latter figure excludes the [[Korean People's Army]], which visibly does much of the country's construction work.<ref name=38north-20170718/>

Since about 2012, when 18 tower blocks were built in Pyongyang, a construction boom has taken place in Pyongyang. Major projects include the [[Mansudae People's Theatre]] (2012), [[Munsu Water Park]] (2013), the modernisation of [[Pyongyang Sunan International Airport]] (2015) and the Science and Technology Center (2015).<ref name=38north-20170718>((cite news |url=http://www.38north.org/2017/07/hferon071817/ |title=Pyongyang's Construction Boom: Is North Korea Beating Sanctions? |last=Féron |first=Henri |publisher=U.S.–Korea Institute, Johns Hopkins University School of Advanced International Studies |work=[[38 North]] |date=July 18, 2017 |access-date=July 20, 2017 |archive-date=July 18, 2017 |archive-url=https://web.archive.org/web/20170718223655/http://www.38north.org/2017/07/hferon071817/ |url-status=live ))</ref><ref name=nyt-20170430/>

===Banking===
((Further|North Korean won|List of banks in North Korea))
The [[Central Bank of the Democratic People's Republic of Korea|Central Bank of North Korea]], under the [[Ministry of Finance (North Korea)|Ministry of Finance]], has a network of 227 local branches. Several reissues of banknotes in recent years suggest that citizens are inclined to hoard rather than bank any savings that they make from their incomes; reportedly they now also prefer foreign currency. At least two foreign aid agencies((Clarify|date=March 2008)) have recently set up microcredit schemes, lending to farmers and small businesses.((Citation needed|date=January 2008))

In late 2009, North Korea revalued its currency, effectively confiscating all privately held money above the equivalent of US$35 per person.<ref>((cite news|url=https://www.nytimes.com/2009/12/02/business/global/02korea.html?_r=2 |author=Choe Sang-Hun |title=North Korea Revalues Its Currency |location=North Korea |newspaper=[[The New York Times]] |date=December 9, 2009 |access-date=December 20, 2011 |url-status=live |archive-url=https://web.archive.org/web/20130521001602/http://www.nytimes.com/2009/12/02/business/global/02korea.html?_r=2 |archive-date=May 21, 2013 ))</ref> The revaluation effectively wiped out the savings of many North Koreans. Days after the revaluation the won dropped 96% against the United States dollar.<ref>((cite web |last1=Lim |first1=Bomi |title=North Korean Won Plunges 96% After Government Revaluation |url=https://infiniteunknown.net/2009/12/09/north-korea-won-plunges-96-percent-against-the-dollar-after-government-revaluation/ |website=Infinite Unknown |publisher=[[Bloomberg News]] |access-date=April 8, 2022 |date=December 9, 2009 |archive-date=August 8, 2022 |archive-url=https://web.archive.org/web/20220808140735/https://infiniteunknown.net/2009/12/09/north-korea-won-plunges-96-percent-against-the-dollar-after-government-revaluation/ |url-status=live ))</ref> [[Pak Nam-gi]], the director of the Planning and Finance Department of North Korea's ruling Workers' Party, was blamed for the disaster and later executed in 2010.<ref>((cite web|url=https://www.bloomberg.com/apps/news?pid=20601080&sid=amrsl_DDQ7.A|title=North Korea Executes Official for Currency Reform, Yonhap Says|publisher=Bloomberg|date=March 17, 2010))</ref>

[[File:Koryo Credit Card.jpg|thumb|A Koryo cash card reader in 2012]]
In 2004 and 2006 laws were passed to codify rules for savings and commercial banking.  However it was not until 2012 that North Korean banks started to seriously compete for retail customers. Competing electronic cash cards have become widely accepted in [[Pyongyang]] and other cities, but are generally not linked to bank accounts. North Korean banks have introduced retail products which permit a mobile phone app to make payments and top-ups.<ref name=38north-20170203>((cite news |url=http://38north.org/2017/02/aabrahamian020317/ |title=Banking on North Korea's Banks? |author=Andray Abrahamian |publisher=U.S.-Korea Institute, Johns Hopkins University School of Advanced International Studies |work=[[38 North]] |date=February 3, 2017 |access-date=February 4, 2017 |url-status=dead |archive-url=https://web.archive.org/web/20170203223456/http://38north.org/2017/02/aabrahamian020317/ |archive-date=February 3, 2017 ))</ref><ref name=38north-20170406/>

As of May 2013, the Chinese banks, [[China Merchants Bank]],<ref name="NK trade">((cite news|title=Cooling China-N Korea ties hit border town |newspaper=Financial Times |date=May 15, 2013 |author=Rabinovitch, Simon |url=http://www.ft.com/cms/s/0/a631e4ee-bbc8-11e2-a4b4-00144feab7de.html |url-status=live |access-date=December 14, 2013 |archive-url=https://web.archive.org/web/20141209030223/http://www.ft.com/cms/s/0/a631e4ee-bbc8-11e2-a4b4-00144feab7de.html |archive-date=December 9, 2014 ))</ref> [[Industrial and Commercial Bank of China]], [[China Construction Bank]], and [[Agricultural Bank of China]], stopped "all cross-border cash transfers, regardless of the nature of the business" with North Korea.<ref name="China banks sactions">((cite news | url=http://www.ft.com/intl/cms/s/0/9bb568b0-bba0-11e2-82df-00144feab7de.html#axzz2TIsuNx9M | archive-url=https://ghostarchive.org/archive/20221210201221/https://www.ft.com/content/9bb568b0-bba0-11e2-82df-00144feab7de#axzz2TIsuNx9M | archive-date=December 10, 2022 | url-access=subscription | url-status=live | title=China banks rein in support for North Korea | newspaper=Financial Times | date=May 13, 2013 | access-date=May 14, 2013 | author=Rabinovitch, Simon ))</ref> The [[Bank of China]], the China's primary institution for foreign exchange transactions, said, on May 14, 2013, that "it had closed the account of [[Foreign Trade Bank]], North Korea's main foreign exchange bank".<ref name="China banks sactions"/><ref name="Bank of China">((cite news | url=http://www.ft.com/intl/cms/s/0/a7154272-b702-11e2-a249-00144feabdc0.html#axzz2TIsuNx9M | archive-url=https://ghostarchive.org/archive/20221210201235/https://www.ft.com/content/a7154272-b702-11e2-a249-00144feabdc0#axzz2TIsuNx9M | archive-date=December 10, 2022 | url-access=subscription | title=China reduces banking lifeline to N Korea | newspaper=Financial Times | date=May 7, 2013 | access-date=May 14, 2013 | author1=Simon Rabinovitch | author2=Simon Mundy | url-status=live ))</ref> However, "smaller banks based in northeastern China across the border from North Korea said it was still handling large-scale cross-border transfers." For example, the [[Bank of Dalian]] branch in Dandong was still doing transfers to North Korea.<ref name="China banks sactions"/>

[[Kim Jong Un]] from 2015 has sought to enlarge and reform the banking sector, to assist economic growth, with credit cards viewed as a way to increase money circulation. The concept of socialist commercial banks is being developed to utilize "idle funds" effectively, including the savings of individuals, to promote economic growth.<ref name=38north-20211222>((cite web |url=https://www.38north.org/2021/12/understanding-kim-jong-uns-economic-policymaking-pyongyangs-views-on-banking/ |title=Understanding Kim Jong Un's Economic Policymaking: Pyongyang's Views on Banking |last1=Carlin |first1=Robert |last2=Lee |first2=Rachel Minyoung |publisher=The Henry L. Stimson Center |work=[[38 North]] |date=December 22, 2021 |access-date=January 3, 2022 |archive-date=January 3, 2022 |archive-url=https://web.archive.org/web/20220103212659/https://www.38north.org/2021/12/understanding-kim-jong-uns-economic-policymaking-pyongyangs-views-on-banking/ |url-status=live ))</ref>

===Retail===
[[File:Number One Department Store, Pyongyang.jpg|thumb|upright|[[Pyongyang Department Store No. 1|Number One Department Store]] in Pyongyang]]
Until the early 2000s the official retail sector was mainly state-controlled,<ref name=guardian-20160711>((cite news|url=https://www.theguardian.com/world/2016/jul/11/north-korea-too-rich-fake-death-defector-story |title='I got too rich in North Korea and had to fake my own death' – a defector's story |author=Roman Super, Claire Bigg |newspaper=The Guardian |date=July 11, 2016 |access-date=April 12, 2017 |url-status=live |archive-url=https://web.archive.org/web/20170413071710/https://www.theguardian.com/world/2016/jul/11/north-korea-too-rich-fake-death-defector-story |archive-date=April 13, 2017 ))</ref> under the direction of the People's Services Committee. Consumer goods were few and of poor quality, with most provided on a ration basis. There were state-run stores and direct factory outlets for the masses, and special shops with luxuries for the elite—as well as a chain of hard-currency stores (a joint venture with the association of pro-Pyongyang Korean residents in Japan, the [[Ch'ongryŏn]]), with branches in large cities.

In 2002 and in 2010, [[Jangmadang|private markets]] were progressively legalized, mostly for food sales.<ref name="atimes-20110923"/> As of 2013, urban and farmer markets were held every 10 days, and most urban residents lived within 2&nbsp;km of a market.<ref name="FAO-WFP-2013"/> Since the 2009 economic intervention, it is common for North Korean citizens to make purchases with [[Chinese yuan]] and [[United States dollar]]s.<ref name="currency">((Cite web |url=https://apnews.com/article/north-korea-economy-dollar-currency-kim-251a6fee83845253da5b6e0309008a87 |language=en-US |date=2023-06-08 |accessdate=2023-06-09 |title='Dollarization' of North Korean economy, once vital, now potential threat to Kim's rule |last=Kim |first=Hyung-Jin |website=[[Associated Press News]] |archive-date=June 9, 2023 |archive-url=https://web.archive.org/web/20230609072901/https://apnews.com/article/north-korea-economy-dollar-currency-kim-251a6fee83845253da5b6e0309008a87 |url-status=live ))</ref>

In 2012, the third large [[shopping mall]] in [[Pyongyang]], the Kwangbok Area Shopping Center, opened.<ref name=38north-20170406>((cite news |url=http://38north.org/2017/04/rfrank040617/ |title=Consumerism in North Korea: The Kwangbok Area Shopping Center |first=Ruediger |last=Frank |publisher=U.S.–Korea Institute, Johns Hopkins University School of Advanced International Studies |work=[[38 North]] |date=April 6, 2017 |access-date=April 10, 2017 |url-status=dead |archive-url=https://web.archive.org/web/20170411055001/http://38north.org/2017/04/rfrank040617/ |archive-date=April 11, 2017 ))</ref><ref name=reuters-20150604>((cite news|url=https://www.reuters.com/article/us-northkorea-change-consumption-idUSKBN0OJ2UH20150604 |title=Pyongyang Bling: The rise of North Korea's consumer comrades |author=James Pearson, Ju-min Park |work=Reuters |date=June 4, 2015 |access-date=April 12, 2017 |url-status=live |archive-url=https://web.archive.org/web/20170413072212/http://www.reuters.com/article/us-northkorea-change-consumption-idUSKBN0OJ2UH20150604 |archive-date=April 13, 2017 ))</ref> In 2014 the construction of another large [[shopping mall]] started.<ref name="nknews-20160811">((cite news |url=https://www.nknews.org/2016/08/north-korea-building-large-shopping-complex-in-pyongyang/ |title=North Korea building large shopping complex in Pyongyang |author=Jh Ahn |work=[[NK News]] |date=August 11, 2016 |access-date=September 10, 2016 |url-status=dead |archive-url=https://web.archive.org/web/20160926234316/https://www.nknews.org/2016/08/north-korea-building-large-shopping-complex-in-pyongyang/ |archive-date=September 26, 2016 ))</ref> As of 2017, these malls sold competing brands of goods, for example at least ten different kinds of toothpaste were being sold.<ref name=38north-20170406/>

In 2017, the [[Korea Institute for National Unification]] estimated there were 440 government-approved markets employing about 1.1 million people.<ref name=nyt-20170430>((cite news |url=https://www.nytimes.com/2017/04/30/world/asia/north-korea-economy-marketplace.html |title=As Economy Grows, North Korea's Grip on Society Is Tested |last=Sang-Hun |first=Choe |newspaper=[[The New York Times]] |date=April 30, 2017 |access-date=May 25, 2018 |archive-date=January 4, 2020 |archive-url=https://web.archive.org/web/20200104075253/https://www.nytimes.com/2017/04/30/world/asia/north-korea-economy-marketplace.html |url-status=live ))</ref>

===Tourism===
((Main|Tourism in North Korea))

===Food===
====Agriculture====
((Main|Agriculture in North Korea))

[[File: DPRK rice.jpg|thumb|Crops growing in North Korea]]

North Korea's sparse agricultural resources limit agricultural production. Climate, terrain, and soil conditions are not particularly favorable for farming,<ref name="Savada1994"/> with a relatively short cropping season. Only about 17% of the total landmass, or approximately ((convert|2000000|ha|km2|disp=output only)), is arable, of which ((convert|1400000|ha|km2|disp=output only)) is well suited for cereal cultivation;<ref name="FAO-WFP-2013"/> the major portion of the country is rugged mountain terrain.<ref name="Savada1994"/>

The weather varies markedly according to elevation, and lack of precipitation, along with infertile soil, makes land at elevations higher than 400 meters unsuitable for purposes other than grazing. Precipitation is geographically and seasonally irregular, and in most parts of the country as much as half the annual rainfall occurs in the three summer months. This pattern favors the cultivation of paddy rice in warmer regions that are outfitted with irrigation and flood control networks.<ref name="Savada1994"/> Rice yields are 5.3 tonnes per hectare, close to international norms.<ref name="38north-20131218"/> In 2005, North Korea was ranked by the [[FAO]] as an estimated 10th in the production of fresh fruit<ref name="FAO-2005-619">((cite web |url=http://www.fao.org/es/ess/top/commodity.html?lang=en&item=619&year=2005 |title=Major Food and Agricultural Commodities and Producer: Countries by commodity |year=2005 |publisher=[[Food and Agriculture Organization|Food and Agriculture Organization of the United Nations]] |access-date=April 8, 2022 |url-status=unfit |archive-url=https://web.archive.org/web/20090805235547/http://www.fao.org/es/ess/top/commodity.html?lang=en&item=619&year=2005 |archive-date=August 5, 2009 ))</ref> and as an estimated 19th in the production of [[apple]]s.<ref name="FAO-2005-515">((cite web |url=http://www.fao.org/es/ess/top/commodity.html?item=515&lang=en&year=2005 |title=Major Food and Agricultural Commodities and Producer: Countries by commodity |year=2005 |publisher=[[Food and Agriculture Organization|Food and Agriculture Organization of the United Nations]] |access-date=April 8, 2022 |url-status=unfit |archive-url=https://web.archive.org/web/20090313171151/http://www.fao.org/es/ess/top/commodity.html?item=515&lang=en&year=2005 |archive-date=March 13, 2009 ))</ref>

Farming is concentrated in the flatlands of the four west coast provinces, where a longer growing season, level land, adequate rainfall, and good irrigated soil permit the most intensive cultivation of crops. A narrow strip of similarly fertile land runs through the eastern seaboard [[Hamgyŏng]] provinces and [[Kangwon Province (North Korea)|Kangwŏn]] Province, but the interior provinces of [[Chagang]] and [[Ryanggang]] are too mountainous, cold, and dry to allow much farming. The mountains contain the bulk of North Korea's forest reserves while the foothills within and between the major agricultural regions provide lands for livestock grazing and fruit tree cultivation.<ref name="Savada1994"/>

Since self-sufficiency remains an important pillar of North Korean ideology, self-sufficiency in food production is deemed a worthy goal. Another aim of government policies—to reduce the gap between urban and rural living standards—requires continued investment in the agricultural sector. The stability of the country depends on steady, if not rapid, increases in the availability of food items at reasonable prices. In the early 1990s, there were severe food shortages.<ref name="Savada1994"/><ref name="undp.org">United Nations Development Program, Millennium Development Goals and the DPRK, retrieved October 21, 21, 2011, ((cite web|url=http://www.undp.org/dprk/mdgs.shtml |title=Millennium Development Goals and the DPRK |access-date=May 15, 2013 |url-status=dead |archive-url=https://web.archive.org/web/20111201032637/http://www.undp.org/dprk/mdgs.shtml |archive-date=December 1, 2011 ))</ref><ref name="personal.lse.ac.uk">Woo-Cumings, Meredith (2002) "The political ecology of famine: the North Korean catastrophe and its lessons". Online at: ((cite web |url=http://personal.lse.ac.uk/SIDEL/images/WooFamine.pdf |title=Archived copy |access-date=May 15, 2013 |url-status=dead |archive-url=https://web.archive.org/web/20130927203219/http://personal.lse.ac.uk/SIDEL/images/WooFamine.pdf |archive-date=September 27, 2013 ))</ref>

[[File:North Korea tractor.jpg|left|thumb|A tractor in North Korea]]
The most far-reaching statement on agricultural policy is embodied in Kim Il Sung's 1964 ''[[Theses on the Socialist Agrarian Question in Our Country]]'', which underscores the government's concern for agricultural development.<ref>((cite book|last=Josephson |first=Paul R. |title=Would Trotsky Wear a Bluetooth?: Technological Utopianism under Socialism, 1917–1989 |url=https://books.google.com/books?id=rOvHOUziXSAC&pg=PA143 |date=December 25, 2009 |publisher=The Johns Hopkins University Press |location=Baltimore |isbn=978-0-8018-9841-9 |page=143 |url-status=live |archive-url=https://web.archive.org/web/20170225095658/https://books.google.com/books?id=rOvHOUziXSAC&pg=PA143 |archive-date=February 25, 2017 ))</ref> Kim emphasized technological and educational progress in the countryside as well as collective forms of ownership and management. As industrialization progressed, the share of agriculture, forestry, and fisheries in the total national output declined from 63.5% and 31.4%, respectively, in 1945 and 1946, to a low of 26.8% in 1990. Their share in the labor force also declined from 57.6% in 1960 to 34.4% in 1989.<ref name="Savada1994"/>

In the 1990s, the decreasing ability to carry out mechanized operations (including the pumping of water for irrigation), as well as lack of chemical inputs, was clearly contributing to reduced yields and increased harvesting and post-harvest losses.<ref name="FAO-WFP-2013"/>

Incremental improvements in agricultural production have been made since the late 1990s, bringing North Korea close to self-sufficiency in [[staple food]]s by 2013. In particular, rice yields have steadily improved, though yields on other crops have generally not improved. The production of protein foods remains inadequate. Access to chemical fertilizer has declined, but the use of compost and other organic fertilizer has been encouraged.<ref name="FAO-WFP-2013">((cite report|url=http://www.fao.org/docrep/019/aq118e/aq118e.pdf |title=FAO/WFP Crop and Food Security Assessment Mission to the Democratic People's Republic of Korea |publisher=Food and Agriculture Organization/World Food Programme |year=2013 |access-date=January 7, 2014 |url-status=live |archive-url=https://web.archive.org/web/20140107145549/http://www.fao.org/docrep/019/aq118e/aq118e.pdf |archive-date=January 7, 2014 ))</ref><ref name="38north-20131218">((cite news|url=http://38north.org/2013/12/rireson121813/ |title=The State of North Korean Farming: New Information from the UN Crop Assessment Report |author=Randall Ireson |publisher=U.S.–Korea Institute, Johns Hopkins University School of Advanced International Studies |work=[[38 North]] |date=December 18, 2013 |access-date=January 7, 2014 |url-status=live |archive-url=https://web.archive.org/web/20140710015244/http://38north.org/2013/12/rireson121813/ |archive-date=July 10, 2014 ))</ref>

====Fisheries====
((Main|Fishing industry in North Korea))
North Korean fisheries export seafood, primarily [[crab]], to [[Dandong, Liaoning]], illicitly.<ref name="SCMPFISH">((cite news |newspaper=[[South China Morning Post]] |title=The fishy side of China's ban on North Korean imports |url=http://www.scmp.com/news/china/diplomacy-defence/article/2109193/fishy-side-chinas-ban-north-korean-imports |date=August 31, 2017 |first=Choi |last=Chi-yuk |access-date=August 31, 2017 |archive-date=August 31, 2017 |archive-url=https://web.archive.org/web/20170831141328/http://www.scmp.com/news/china/diplomacy-defence/article/2109193/fishy-side-chinas-ban-north-korean-imports |url-status=live ))</ref> Crabs, clams and conches from the [[Yellow Sea]] waters of North Korea are popular in China, possibly because the less salty water improves taste.<ref name="SCMPFISH"/>

====Food distribution system====
Since the 1950s, a majority of North Koreans have received their food through the [[public distribution system (North Korea)|public distribution system]] (PDS). The PDS requires farmers in agricultural regions to hand over a portion of their production to the government and then reallocates the surplus to urban regions, which cannot grow their own foods. About 70% of the [[Demographics of North Korea|North Korean population]], including the entire [[urban population]], receives food through this government-run system.<ref name="FAO-WFP-2013"/>

Before the floods, recipients were generally allotted 600–700&nbsp;grams per day while high officials, military men, heavy laborers, and public security personnel were allotted slightly larger portions of 700–800&nbsp;grams per day.<ref>((Cite journal|last1=Goodkind|first1=Daniel|last2=West|first2=Loraine|title=The North Korean Famine and Its Impact Demographic|url=https://www.jstor.org/stable/2695207|journal=Population Council|jstor=2695207|access-date=March 8, 2021|archive-date=March 8, 2021|archive-url=https://web.archive.org/web/20210308114755/https://www.jstor.org/stable/2695207|url-status=live))</ref> As of 2013, the target average distribution was 573 grams of cereal equivalent per person per day, but varied according to age, occupation, and whether rations are received elsewhere (such as school meals).<ref name="FAO-WFP-2013"/> However, as of 2019, this number has been reduced to 312 grams per day according to an investigation conducted by the [[United Nations]] between March 29 and April 12.<ref>((Cite web|url=https://www.globalcitizen.org/en/content/north-korea-food-insecurity-food-aid/|title=North Korea Cuts Food Rations to Just 11 Ounces per Day|date=May 3, 2019 |access-date=December 19, 2019|archive-date=December 19, 2019|archive-url=https://web.archive.org/web/20191219010000/https://www.globalcitizen.org/en/content/north-korea-food-insecurity-food-aid/|url-status=live))</ref>

Decreases in production affected the quantity of food available through the public distribution system. Shortages were compounded when the North Korean government imposed further restrictions on collective farmers. When farmers, who had never been covered by the PDS, were mandated by the government to reduce their own food allotments from 167 kilograms to 107 kilograms of grain per person each year, they responded by withholding portions of the required amount of grain. By 2008, the system had significantly recovered, and, from 2009 to 2013, daily per person rations averaged at 400 grams per day for much of the year, though in 2011 it dropped to 200 grams per day from May to September.<ref name="FAO-WFP-2013"/>

It is estimated that in the early 2000s, the average North Korean family drew some 80% of its income from small businesses that were technically illegal (though unenforced) in North Korea. In 2002 and in 2010, [[Jangmadang|private markets]] were progressively legalized.<ref name="atimes-20110923">((cite news|url=http://www.atimes.com/atimes/Korea/MI23Dg02.html |title=It's not all doom and gloom in Pyongyang |publisher=Asia Times |date=September 23, 2011 |access-date=October 9, 2011 |url-status=unfit |archive-url=https://web.archive.org/web/20110924095232/http://www.atimes.com/atimes/Korea/MI23Dg02.html |archive-date=September 24, 2011 ))</ref> As of 2013, urban and farmer markets were held every 10 days, and most urban residents lived within 2&nbsp;km of a market, with markets having an increasing role in obtaining food.<ref name="FAO-WFP-2013"/>

====Crisis and famine====
((Main|North Korean famine))
From 1994 to 1998, North Korea suffered a famine. Since North Korea is a closed country, the number of specific deaths in the incident is difficult to know. According to different literature, the starved or malnourished death toll is estimated to be between 240,000 and 480,000. Since 1998 there has been a gradual recovery in agriculture production, which by 2013 brought North Korea back close to self-sufficiency in [[staple food]]s. However, as of 2013, most households have borderline or poor food consumption, and consumption of protein remains inadequate.<ref name="FAO-WFP-2013"/>

In the 1990s, the North Korean economy saw stagnation turning into crisis. [[Aid|Economic assistance]] received from the Soviet Union and China was an important factor of its economic growth. Upon its collapse in 1991, the Soviet Union withdrew its support and demanded payment in hard currency for imports. China stepped in to provide some assistance and supplied food and oil, most of it reportedly at concessionary prices.((Citation needed|date=January 2008)) The North Korean economy was undermined and its industrial output began to decline in 1990. Deprived of industrial inputs, including fertilizers, pesticides, and electricity for irrigation, agricultural output also started to decrease even before North Korea had a series of [[natural disaster]]s in the mid-1990s. This evolution, combined with a series of natural disasters including record floods in 1995, caused one of the worst economic crises in North Korea's history. Other causes of this crisis were high defense spending (about 25% of GDP) and bad governance.

In December 1991, North Korea established a "zone of free economy and trade" to include the northeastern port cities of Unggi ([[Sonbong|Sŏnbong]]), Ch'ŏngjin, and Najin. The establishment of this zone also had ramifications on the questions of how far North Korea would go in opening its economy to the West and to South Korea, the future of the development scheme for the [[Tumen River]] area, and, more important, how much North Korea would reform its economic system.<ref name="Savada1994"/>

North Korea announced in December 1993 a three-year transitional economic policy placing primary emphasis on agriculture, light industry, and foreign trade. However, lack of fertilizer, natural disasters, and poor storage and transportation practices have left the country more than a million tons per year short of grain self-sufficiency.<ref name="Bloomberg2016">((cite web|last1=McFerron|first1=Whitney|title=North Korea Food Supply Imperiled by Drought, UN Says|url=https://www.bloomberg.com/news/articles/2016-04-27/north-korea-s-food-supply-imperiled-by-water-shortages-un-says|website=Bloomberg.com|access-date=February 23, 2017|archive-url=https://web.archive.org/web/20160710111621/http://www.bloomberg.com/news/articles/2016-04-27/north-korea-s-food-supply-imperiled-by-water-shortages-un-says|archive-date=July 10, 2016|date=April 27, 2016|quote=North Korea's already-low food supplies are about to get worse after poor rainfall in the past year slashed the nation's critical rice crop, the United Nations said.  At least 70% of North Korea's population, or about 18 million people, already rely on the government as their main source of food grain and for months has received well below the targeted daily ration, UN's Food & Agriculture Organization said in a report Wednesday. The country will need to import almost 700,000 metric tons of grain to meet its needs this year, but government purchases are only expected to reach 300,000 tons, the report said.))</ref><ref name="UPI2016">((cite web|last1=Shim|first1=Elizabeth|title=North Korea's food shortage grows but elites remain unaffected, Seoul says|url=http://www.upi.com/Top_News/World-News/2016/09/27/North-Koreas-food-shortage-grows-but-elites-remain-unaffected-Seoul-says/4001474997303/|website=UPI.com|access-date=February 23, 2017|archive-url=https://web.archive.org/web/20170120044413/http://www.upi.com/Top_News/World-News/2016/09/27/North-Koreas-food-shortage-grows-but-elites-remain-unaffected-Seoul-says/4001474997303/|archive-date=January 20, 2017|date=September 27, 2016|quote=In 2014, North Korea's food shortage was estimated to be 340,000 tons and 407,000 tons in 2015. In 2015, North Korea's grain production was hit heavily by a drought. A lack of fertilizer and other resources could have also contributed to the deficit, according to the report.))</ref> Moreover, lack of foreign exchange to purchase spare parts and oil for electricity generation left many factories idle.<ref name="RandPark2010Dissertation">((cite web|last1=Park|first1=Ki-Tae|title=Analyzing North Korea's Decision-Making Process on its Nuclear Weapons Programs with the Rational Choice and Cognitive Choice Models|url=http://www.rand.org/content/dam/rand/pubs/rgs_dissertations/2010/RAND_RGSD268.pdf|website=Rand.org|publisher=Pardee Rand Graduate School|access-date=February 23, 2017|archive-url=https://web.archive.org/web/20130310231533/http://www.rand.org/content/dam/rand/pubs/rgs_dissertations/2010/RAND_RGSD268.pdf|archive-date=March 10, 2013|date=2010|quote=This severe shortage of oil imports and coal production provided the first phase of vicious cycle of economic recession by getting industrial factories idle in the first place. Pyongyang, in return, could have not produced export merchandize enough to earn foreign reserve due to the low operation rates of its factories and lack of raw materials, thereby significantly reducing its foreign reserve acquisition. The lack of foreign exchange reserves again caused the shortage of oil import and then the oil shortage made its amount of agricultural product diminish sharply due to the inability to use its machinery and artificial fertilizers, most of which are highly dependent on oil and coal consumption in their production.))</ref>

The 1990s famine paralyzed many of the Stalinist economic institutions. The government pursued Kim Jong Il's ''[[Songun]]'' policy, under which the military is deployed to direct production and infrastructure projects. As a consequence of the government's policy of establishing economic self-sufficiency, the North Korean economy has become increasingly isolated from that of the rest of the world, and its industrial development and structure do not reflect its international competitiveness. Domestic firms are shielded from international as well as domestic competition; the result is chronic inefficiency, poor quality, limited product diversity, and underutilization of plants.((Citation needed|date=January 2008)) This [[protectionism]] also limits the size of the market for North Korean producers,<ref name="Savada1994"/> which prevents taking advantage of [[Economy of scale|economies of scale]].

====Food shortages====
The food shortage was primarily precipitated by the loss of fuel and other raw materials imports from China and the Soviet Union which had been essential to support an energy intensive and energy inefficient farming system. Following the collapse of the Soviet Union, the former concessional trade relationships which benefited the North Korea were not available. The three flood and drought years between 1994 and 1996 only served to complete the collapse of the agriculture sector.<ref name="undp.org"/><ref>((cite web |last1=Ireson |first1=Randall |title=Food Security in North Korea: Designing Realistic Possibilities |url=http://fsi-media.stanford.edu/evnts/4140/Ireson_FoodSecurity_2006.pdf |publisher=Asia-Pacific Research Center, Stanford University |access-date=June 15, 2007 |url-status=dead |archive-url=https://web.archive.org/web/20150904004856/http://fsi-media.stanford.edu/evnts/4140/Ireson_FoodSecurity_2006.pdf |archive-date=September 4, 2015 ))</ref><ref>((cite web |title=CIA World Fact Book |date=November 24, 2021 |url=https://www.cia.gov/the-world-factbook/countries/korea-north/ |access-date=January 24, 2021 |archive-date=August 12, 2015 |archive-url=https://web.archive.org/web/20150812052526/https://www.cia.gov/library/publications/the-world-factbook/geos/kn.html |url-status=live ))</ref>
In 2004, more than half (57%) of the population did not have enough food to stay healthy. 37% of children had their growth stunted and ((frac|1|3)) of mothers severely lacked nutrition.<ref>((cite web|last1=Central Bureau of Statistics |title=DPRK 2004 Nutrition Assessment Report of Survey Results |url=http://www.unicef.org/dprk/dprk_national_nutrition_assessment_2004_final_report_07_03_05.pdf |access-date=June 15, 2015 |url-status=live |archive-url=https://web.archive.org/web/20160304092506/http://www.unicef.org/dprk/dprk_national_nutrition_assessment_2004_final_report_07_03_05.pdf |archive-date=March 4, 2016 ))</ref>

In 2006, the World Food Program (WFP) and FAO estimated a requirement of 5.3 to 6.5 million tons of grain when domestic production fulfilled only 3.825 million tons.<ref>((cite journal|journal=[[Human Rights Watch]] |title=A matter of survival: the North Korean government's control of food and the risk of hunger |year=2006 |volume=18 |issue=3 |url=http://reliefweb.int/report/democratic-peoples-republic-korea/matter-survival-north-korean-governments-control-food-and |url-status=live |access-date=December 14, 2013 |archive-url=https://web.archive.org/web/20131215011748/http://reliefweb.int/report/democratic-peoples-republic-korea/matter-survival-north-korean-governments-control-food-and |archive-date=December 15, 2013 ))</ref> The country also faces [[land degradation]] after forests stripped for agriculture resulted in soil erosion.<ref>((cite web |title=CIA&nbsp;— The World Factbook |date=November 24, 2021 |url=https://www.cia.gov/the-world-factbook/countries/korea-north/ |publisher=Central Intelligence Agency |access-date=January 24, 2021 |archive-date=August 12, 2015 |archive-url=https://web.archive.org/web/20150812052526/https://www.cia.gov/library/publications/the-world-factbook/geos/kn.html |url-status=live ))</ref> In 2008, a decade after the worst years of the famine, total production was 3.34 million tons (grain equivalent) compared with a need of 5.98 million tons. Thirty seven percent of the population was deemed to be insecure in food access.<ref>((cite web|title=FAO/WFP Crop and Food Security Assessment Mission to the Democratic People's Republic of Korea 8 December 2008 |url=http://www.fao.org/fileadmin/user_upload/emergencies/docs/FAO-WFP_Crop_and_Food_Supply_Assessment_Mission_Report.pdf |website=fao.org |access-date=January 15, 2009 |url-status=live |archive-url=https://web.archive.org/web/20150904004856/http://www.fao.org/fileadmin/user_upload/emergencies/docs/FAO-WFP_Crop_and_Food_Supply_Assessment_Mission_Report.pdf |archive-date=September 4, 2015 ))</ref> Weather continued to pose challenges every year, but overall food production grew gradually, and by 2013, production had increased to the highest level since the crisis, to 5.03 million tons cereal equivalent, against a minimum requirement of 5.37 MMT.<ref>((cite web|title=FAO/WFP Crop and Food Security Assessment Mission to the Democratic People's Republic of Korea, 28 November 2013 |url=http://www.fao.org/docrep/019/aq118e/aq118e.pdf |website=fao.org |access-date=January 15, 2015 |url-status=live |archive-url=https://web.archive.org/web/20150306030926/http://www.fao.org/docrep/019/aq118e/aq118e.pdf |archive-date=March 6, 2015 ))</ref>

In 2014, North Korea had an exceptionally good harvest, 5.08 million tonnes of cereal equivalent, almost sufficient to feed the entire population.<ref name="aljazeera-20140327">((cite news|url=http://www.aljazeera.com/indepth/opinion/2014/03/n-korea-myth-starvation-2014319124439924471.html |title=N Korea and the myth of starvation |author=Andrei Lankov |publisher=Al Jazeera |date=March 27, 2014 |access-date=November 8, 2014 |url-status=live |archive-url=https://web.archive.org/web/20141121211528/http://www.aljazeera.com/indepth/opinion/2014/03/n-korea-myth-starvation-2014319124439924471.html |archive-date=November 21, 2014 ))</ref> While food production had recovered significantly since the hardest years of 1996 and 1997, the recovery was fragile, subject to adverse weather and year to year economic shortages. Distribution was uneven, with the Public Distribution System being largely ineffective. North Korea now has in most years lower malnutrition levels than in some richer Asian countries.<ref name=ap-20190322>((cite news |url=https://apnews.com/fe394eef5f7848f5be284d21a4b7624a |title=North Korea, seeking food aid, links sanctions to shortages |last=Talmadge |first=Eric |publisher=Associated Press |date=March 22, 2019 |access-date=April 2, 2019 |archive-date=May 8, 2019 |archive-url=https://web.archive.org/web/20190508232655/https://apnews.com/fe394eef5f7848f5be284d21a4b7624a |url-status=live ))</ref> However, in 2019 North Korea had the worst harvest in over a decade, which the United Nations described as a "hunger crisis".<ref>((Cite web|date=May 3, 2019|title=North Korean families facing deep 'hunger crisis' after worst harvest in 10 years, UN food assessment shows|url=https://news.un.org/en/story/2019/05/1037831|access-date=October 20, 2021|website=UN News|language=en|archive-date=October 20, 2021|archive-url=https://web.archive.org/web/20211020073325/https://news.un.org/en/story/2019/05/1037831|url-status=live))</ref>

===Mining===
((Main|Mining in North Korea))
According to a 2012 report by South Korea-based North Korea Resource Institute (NKRI), North Korea has substantial reserves of iron ore, coal, limestone, and magnesite.<ref name=KH82612>((cite news|title=N.K. mineral resources may be worth $9.7tr|url=http://view.koreaherald.com/kh/view.php?ud=20120826000070|access-date=August 27, 2012|newspaper=[[The Korea Herald]]|date=August 26, 2012|agency=Yonhap News))</ref> In addition, North Korea is thought to have tremendous potential rare metal resources, which have been valued in excess of US$6 trillion.<ref>((cite news|title=North Korea, New Land of Opportunity? |url=http://www.businessweek.com/magazine/north-korea-new-land-of-opportunity-01192012.html |access-date=September 2, 2012 |newspaper=Bloomberg Business News |date=January 19, 2012 |url-status=dead |archive-url=https://web.archive.org/web/20120817080358/http://www.businessweek.com/magazine/north-korea-new-land-of-opportunity-01192012.html |archive-date=August 17, 2012 ))</ref>

It is the world's 18th largest producer of [[List of countries by iron production|iron]] and [[List of countries by zinc production|zinc]], and has the [[Coal#World coal reserves|22nd largest]] [[coal]] reserves in the world. It is also the 15th largest [[List of countries by fluorite production|fluorite producer]] and 12th largest producer of [[List of countries by copper mine production|copper]] and [[List of countries by salt production|salt]] in Asia. Other major natural resources in production include [[lead]], [[tungsten]], [[graphite]], [[magnesite]], [[gold]], [[pyrite]]s, [[fluorspar]], and [[hydropower]].

In 2015, North Korea exported 19.7 million tonnes of coal, worth $1.06 billion, much of it to China.<ref>[http://www.scmp.com/news/china/policies-politics/article/2053695/china-suspends-north-korean-coal-imports-three-weeks China suspends North Korean coal imports for three weeks in line with UN sanctions] ((webarchive|url=https://web.archive.org/web/20161212054426/http://www.scmp.com/news/china/policies-politics/article/2053695/china-suspends-north-korean-coal-imports-three-weeks |date=December 12, 2016 )), SCMP, December 11, 2016</ref>
In 2016 it was estimated that coal shipments to China accounted for about 40% of exports.<ref>((cite news |title=Striking black gold: How North Koreans became coal entrepreneurs |url=https://www.nknews.org/2016/06/striking-black-gold-how-north-koreans-became-coal-entrepreneurs/ |first=Andrei |last=Lankov |work=[[NK News]] |date=June 14, 2016 |url-status=dead |archive-url=https://web.archive.org/web/20160614123513/https://www.nknews.org/2016/06/striking-black-gold-how-north-koreans-became-coal-entrepreneurs/ |archive-date=June 14, 2016 |access-date=June 14, 2016 ))</ref>

However, starting from February 2017 China suspended all North Korean coal imports, although according to China overall trade with North Korea increased.<ref>((cite web|url=https://www.nytimes.com/2017/04/13/world/asia/china-north-korea-trade-coal-nuclear.html?_r=0 |last1=Perlez|first1=Jane|author2=Yufan Huang|title=China Says Its Trade With North Korea Has Increased |date=April 13, 2017 |access-date=April 22, 2017 | work=[[The New York Times]]|url-status=live |archive-url=https://web.archive.org/web/20170622203936/https://www.nytimes.com/2017/04/13/world/asia/china-north-korea-trade-coal-nuclear.html?_r=0 |archive-date=June 22, 2017 ))</ref><ref>((cite web|url=https://www.nytimes.com/2017/02/18/world/asia/north-korea-china-coal-imports-suspended.html |author=Choe Sang-Hun|title=China Suspends All Coal Imports From North Korea|date=February 18, 2017| work=[[The New York Times]] |access-date=February 25, 2017 |url-status=live |archive-url=https://web.archive.org/web/20170219080116/https://www.nytimes.com/2017/02/18/world/asia/north-korea-china-coal-imports-suspended.html |archive-date=February 19, 2017 ))</ref>

===Information technology and culture===
((see also|Korea Computer Center))
North Korea has a developing information technology industry. In 2018, a technological exhibition unveiled a new [[Wi-Fi]] service called [[Mirae (Wi-Fi)|Mirae]] ("Future"), which allowed mobile devices to access the intranet network in Pyongyang. The exhibition also showcased a [[home automation]] system using [[speech recognition]] in Korean.<ref>((cite news|url=https://www.bbc.com/news/world-asia-46563454|title=North Korea's high-tech pursuits: Propaganda or progress?|first=Pratik|last=Jakhar|publisher=BBC|date=December 15, 2018|access-date=December 16, 2018|archive-date=August 7, 2020|archive-url=https://web.archive.org/web/20200807103256/https://www.bbc.com/news/world-asia-46563454|url-status=live))</ref>

North Korea established the Artificial Intelligence Research Institute under the Bureau of the Information Industry Guidance in 2013, which in 2021 was incorporated into the [[Ministry of Information Industry (North Korea)|Ministry of Information Industry]].<ref name=38north-20240123>((cite web |url=https://www.38north.org/2024/01/north-koreas-artificial-intelligence-research-trends-and-potential-civilian-and-military-applications/ |title=North Korea's Artificial Intelligence Research: Trends and Potential Civilian and Military Applications |last=Kim |first=Hyuk |publisher=The Henry L. Stimson Center |work=[[38 North]] |date=23 January 2024 |access-date=30 January 2024 |archive-date=January 30, 2024 |archive-url=https://web.archive.org/web/20240130141817/https://www.38north.org/2024/01/north-koreas-artificial-intelligence-research-trends-and-potential-civilian-and-military-applications/ |url-status=live ))</ref>

North Korea's [[cartoon animation]] studios such as [[SEK Studio]] sub-contract work from South Korean animation studios.<ref>((Cite news|first=Sunny|last=Lee|title=US cartoons 'made in North Korea' |date=March 14, 2007|url=http://www.atimes.com/atimes/Korea/IC14Dg03.html|archive-url=https://web.archive.org/web/20070321004339/http://www.atimes.com/atimes/Korea/IC14Dg03.html|url-status=unfit|archive-date=March 21, 2007|access-date=October 27, 2010|work=[[Asia Times Online]]))</ref> [[Mansudae Overseas Projects]] builds monuments around the world.<ref name=millions>((cite news|last=Winn |first=Patrick |title=North Korea propaganda unit builds monuments abroad |url=http://www.globalpost.com/dispatch/news/regions/asia-pacific/south-korea/110802/north-korea-cambodia-propaganda-angkor-wat |work=Global Post |access-date=October 11, 2012 |date=August 3, 2011 |url-status=live |archive-url=https://web.archive.org/web/20121016211348/http://www.globalpost.com/dispatch/news/regions/asia-pacific/south-korea/110802/north-korea-cambodia-propaganda-angkor-wat |archive-date=October 16, 2012 ))</ref>

==Organization and management==
North Korea's economy has been unique in its historical suppression of [[market economy|markets]]. By the 1960s, market elements had been suppressed almost completely. Almost all items, from food to clothes, have traditionally been handed out through a public distribution system, with money only having a symbolic meaning. Ratios of food depend on [[hierarchy]] in the system, wherein the positions seem to be [[inheritance|semi-hereditary]]. Until the late 1980s, peasants were not allowed to cultivate private garden plots.<ref name="nbr.org">A. Lankov. ''The Natural Death of North Korean Stalinism''. p. 110. Available at ((cite web |url=http://www.nbr.org/publications/asia_policy/pdf/ap1-lankov.pdf |title=Archived copy |access-date=August 17, 2007 |url-status=dead |archive-url=https://web.archive.org/web/20070724031859/http://www.nbr.org/publications/asia_policy/pdf/ap1-lankov.pdf |archive-date=July 24, 2007  )), accessed on August 16, 2009.</ref>

Since the government is the dominant force in the development and management of the economy, bureaus and departments have proliferated at all administrative levels. There are fifteen committees—such as the agricultural and state planning committees—one bureau, and twenty departments under the supervision of the Cabinet; of these, twelve committees—one bureau, and sixteen departments are involved in economic management. In the early 1990s, several vice premiers of the then State Administration Council supervised economic affairs. Organizations undergo frequent reorganization. Many of these agencies have their own separate branches at lower levels of government while others maintain control over subordinate sections in provincial and county administrative agencies.<ref name="Savada1994"/>

Around 1990, with the [[collapse of the Soviet Union]], restrictions on private sales, including grain, ceased to be enforced. It is estimated that in the early 2000s, the average North Korean family drew some 80% of its income from small businesses that were technically illegal (though unenforced) in North Korea. In 2002, and in 2010, private markets were progressively legalized.<ref name="atimes-20110923"/> As of 2013, urban and farmer markets were held every 10 days, and most urban residents lived within 2&nbsp;km of a market.<ref name="FAO-WFP-2013"/>

In 2014, North Korea announced the "May 30th measures". These planned to give more freedom to farmers, allowing them to keep 60% of their produce. Also enterprise managers would be allowed to hire and fire workers, and decide whom they do business with and where they buy raw materials and spare parts.<ref name=WSJ>Kwaak, Jeyup S. and Gale, Alastair (December 2, 2014). "[https://blogs.wsj.com/korearealtime/2014/12/02/north-korea-expert-forecasts-new-economic-reform-push/ North Korea Expert Touts 'Revolutionary' Economic Plans]". ((webarchive|url=https://web.archive.org/web/20141213123113/https://blogs.wsj.com/korearealtime/2014/12/02/north-korea-expert-forecasts-new-economic-reform-push/ |date=December 13, 2014 )) ''The Wall Street Journal''. Retrieved January 15, 2015</ref> Some reports suggest that these measures would allow nominally state-run enterprises to be run on capitalist lines like those in China.<ref name=BBC>Evans, Stephen (January 14, 2015). "[https://www.bbc.co.uk/news/business-30812237 A quiet revolution in North Korea]". ((webarchive|url=https://web.archive.org/web/20150119015654/http://www.bbc.co.uk/news/business-30812237 |date=January 19, 2015 )) ''BBC News''. Retrieved January 15, 2015</ref>

===Economic planning===
North Korea, one of the world's most centrally planned and isolated economies, faces desperate economic conditions.<ref>((cite web|url=http://www.atimes.com/atimes/Korea/LG17Dg02.html |archive-url=https://web.archive.org/web/20100719110635/http://www.atimes.com/atimes/Korea/LG17Dg02.html |url-status=unfit |archive-date=July 19, 2010 |work=Asia Times Online|title= Korea News and Korean Business and Economy, Pyongyang News |date=July 17, 2010 |access-date=March 31, 2012))</ref>  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.
During what North Korea called the "peaceful construction" period before the Korean War, the fundamental task of the economy was to overtake the level of output and efficiency attained toward the end of the [[Korea under Japanese rule|Japanese occupation]]; to restructure and develop a viable economy reoriented toward the communist-bloc countries; and to begin the process of socializing the economy. Nationalization of key industrial enterprises and land reform, both of which were carried out in 1946, laid the groundwork for two successive one-year plans in 1947 and 1948, respectively, and the Two-Year Plan of 1949–50. It was during this period that the piece-rate wage system and the independent accounting system began to be applied and that the commercial network increasingly came under state and cooperative ownership.<ref name="Savada1994"/>

The basic goal of the Three-Year Plan, officially named "The Three-Year Post-war Reconstruction Plan of 1954–56",<!-- abbreviation in original name --> was to reconstruct an economy torn by the Korean War. The plan stressed more than merely regaining the prewar output levels. The Soviet Union, other East European countries and China provided reconstruction assistance. The highest priority was developing heavy industry, but an earnest effort to collectivize farming also was begun. At the end of 1957, output of most industrial commodities had returned to 1949 levels, except for a few items such as chemical fertilizers, carbides, and [[sulfuric acid]], whose recovery took longer.<ref name="Savada1994"/>

Having basically completed the task of reconstruction, the state planned to lay a solid foundation for industrialization while completing the socialization process and solving the basic problems of food and shelter during the Five-Year Plan of 1957–1960. The socialization process was completed by 1958 in all sectors of the economy, and the Ch'ŏllima Movement was introduced. Although growth rates reportedly were high, there were serious imbalances among the different economic sectors. Because rewards were given to individuals and enterprises that met [[production quota]]s, frantic efforts to fulfill plan targets in competition with other enterprises and industries caused disproportionate growth among various enterprises, between [[Industrial sector|industry]] and [[agriculture]] and between light and heavy industries. Because resources were limited and the transportation system suffered bottlenecks, resources were diverted to politically well-connected enterprises or those whose managers complained the loudest. An enterprise or industry that performed better than others often did so at the expense of others. Such disruptions intensified as the target year of the plan approached.<ref name="Savada1994"/>

Until the 1960s, North Korea's economy grew much faster than South Korea's. Although North Korea was behind in total national output, it was ahead of South Korea in per capita national output, because of its smaller population relative to South Korea. For example, in 1960 North Korea's population was slightly over 10 million people, while South Korea's population was almost 25 million people. Annual economic growth rates of 30% and 21% during the Three-Year Plan of 1954–1956 and the Five-Year Plan of 1957–1960, respectively, were reported. After claiming early fulfillment of the Five-Year Plan in 1959, North Korea officially designated 1960 a "buffer year"—a year of adjustment to restore balances among sectors before the next plan became effective in 1961. Not surprisingly the same phenomenon recurred in subsequent plans. Because the Five-Year Plan was fulfilled early, it became a de facto four-year plan. Beginning in the early 1960s, however, North Korea's economic growth slowed until it was stagnant at the beginning of the 1990s.<ref name="Savada1994"/>

Various factors explain the very high rate of economic development of the country in the 1950s and the general slowdown since the 1960s. During the reconstruction period after the Korean War, there were opportunities for extensive economic growth—attainable through the communist regime's ability to marshall idle resources and labor and to impose a low rate of [[Consumption (economics)|consumption]]. This general pattern of initially high growth resulting in a high rate of capital formation was mirrored in other Soviet-type economies. Toward the end of the 1950s, as reconstruction work was completed and idle capacity began to diminish, the economy had to shift from the extensive to the intensive stage, where the simple communist discipline of marshaling underutilized resources became less effective. In the new stage, inefficiency arising from emerging bottlenecks led to [[diminishing returns]]. Further growth would only be attained by increasing efficiency and technological progress.<ref name="Savada1994"/>

Beginning in the early 1960s, a series of serious bottlenecks began to impede development. Bottlenecks were pervasive and generally were created by the lack of arable land, skilled [[Labour (economics)|labor]], [[energy]], and [[transportation]], and deficiencies in the [[extractive industries]]. Moreover, both land and marine transportation lacked modern equipment and modes of transportation. The inability of the energy and extractive industries as well as of the transportation network to supply power and raw materials as rapidly as the manufacturing plants could absorb them began to slow industrial growth.<ref name="Savada1994"/>

The First Seven-Year Plan (initially 1961–1967) built on the groundwork of the earlier plans but changed the focus of [[industrialization]]. Heavy industry, with the machine tool industry as its linchpin, was given continuing priority. During the plan, however, the economy experienced widespread slowdowns and reverses for the first time, in sharp contrast to the rapid and uninterrupted growth during previous plans. Disappointing performance forced the planners to extend the plan three more years, until 1970. During the last part of the ''[[de facto]]'' ten-year plan, emphasis shifted to pursuing parallel development of the economy and of defense capabilities. This shift was prompted by concern over the military takeover in South Korea by General [[Park Chung Hee]] (1961–1979), escalation of the United States involvement in [[Vietnam]], and the widening [[Sino-Soviet split]]. It was thought that stimulating a technological revolution in the munitions industry was one means to achieve these parallel goals. In the end, the necessity to divert resources to defense became the official explanation for the plan's failure.<ref name="Savada1994"/>

The Six-Year Plan of 1971–1976 followed immediately in 1971. In the aftermath of the poor performance of the preceding plan, growth targets of the Six-Year Plan were scaled down substantially. Because some of the proposed targets in the First Seven-Year Plan had not been attained even by 1970, the Six-Year Plan did not deviate much from its predecessor in basic goals. The Six-Year Plan placed more emphasis on technological advance, self-sufficiency (''[[Juche]]'') in industrial raw materials, improving product quality, correcting imbalances among different sectors, and developing the power and extractive industries; the last of these had been deemed largely responsible for slowdowns during the First Seven-Year Plan. The plan called for attaining a self- sufficiency rate of 60–70% in all industrial sectors by substituting domestic raw materials wherever possible and by organizing and renovating technical processes to make the substitution feasible. Improving transport capacity was seen as one of the urgent tasks in accelerating economic development—it was one of the major bottlenecks of the Six-Year Plan.<ref name="Savada1994"/>

North Korea claimed to have fulfilled the Six-Year Plan by the end of August 1975, a full year and four months ahead of schedule. Under the circumstances, it was expected that the next plan would start without delay in 1976, a year early, as was the case when the First Seven-Year Plan was instituted in 1961. Even if the Six-Year Plan had been completed on schedule, the next plan should have started in 1977. However, it was not until nearly two years and four months later that the long-awaited plan was unveiled—1977 had become a "buffer year".<ref name="Savada1994"/>

The inability of the planners to continuously formulate and institute economic plans reveals as much about the inefficacy of planning itself as the extent of the economic difficulties and administrative disruptions facing the country. For example, targets for successive plans have to be based on the accomplishments of preceding plans. If these targets are underfulfilled, all targets of the next plan—initially based on satisfaction of the plan—have to be reformulated and adjusted. Aside from underfulfillment of the targets, widespread disruptions and imbalances among various sectors of the economy further complicate plan formulation.<ref name="Savada1994"/>

The basic thrust of the Second Seven-Year Plan (1978–1984) was to achieve the three-pronged goals of self-reliance, modernization, and "scientification". Although the emphasis on self-reliance was not new, it had not previously been the explicit focus of an economic plan. This new emphasis might have been a reaction to mounting foreign debt originating from large-scale imports of Western machinery and equipment in the mid-1970s. Through modernization North Korea hoped to increase mechanization and automation in all sectors of the economy. "Scientification" means the adoption of up-to-date production and management techniques. The specific objectives of the economic plan were to strengthen the fuel, energy, and resource bases of industry through priority development of the energy and extractive industries; to modernize industry; to substitute domestic resources for certain imported raw materials; to expand freight-carrying capacity in railroad, road, and marine transportation systems; to centralize and containerize the transportation system; and to accelerate a technical revolution in agriculture.<ref name="Savada1994"/>

In order to meet the manpower and technology requirements of an expanding economy, the education sector also was targeted for improvements. The quality of the comprehensive eleven-year compulsory education system was to be enhanced to train more technicians and specialists, and to expand the training of specialists, particularly in the fields of fuel, mechanical, electronic, and [[automation engineering]].<ref name="Savada1994"/>

Successful fulfillment of the so-called nature-remaking projects also was part of the Second Seven-Year Plan. These projects referred to the five-point program for nature transformation unveiled by Kim Il Sung in 1976: completing the irrigation of non-paddy fields; reclaiming 1,000 square kilometres of new land; building 1,500 to 2,000&nbsp;km((sup|2)) of terraced fields; carrying out afforestation and water conservation work; and reclaiming tidal land.<ref name="Savada1994"/>

From all indications, the Second Seven-Year Plan was not successful. North Korea generally downplayed the accomplishments of the plan, and no other plan received less official fanfare. It was officially claimed that the economy had grown at an annual rate of 8.8% during the plan, somewhat below the planned rate of 9.6%. The reliability of this aggregate measure, however, is questionable. During the plan, the target annual output of 10 million tons of [[Food grain|grains]] (cereals and pulses) was attained. However, by official admission, the targets of only five other commodities were fulfilled. Judging from the growth rates announced for some twelve industrial products, it is highly unlikely that the total industrial output increased at an average rate of 12.2% as claimed. After the plan concluded, there was no new economic plan for two years, indications of both the plan's failure and the severity of the economic and planning problems confronting the economy in the mid-1980s.<ref name="Savada1994"/> From 1998 to 2003, the government implemented a plan for scientific and technical development, which focused on the nation's IT and electronic industry.<ref>Schwekendiek, Daniel, ''A socioeconomic history of North Korea'', Jefferson and London: McFarland Publishers, 2011, p.122</ref>

===Corruption===
((Main|Corruption in North Korea))
In 2019, North Korea was ranked 172nd in the [[Transparency International]] [[Corruption Perceptions Index]] with a score of 17 out of 100.<ref>((Cite web|url=https://www.transparency.org/cpi2019|title=2019 – Cpi|access-date=February 17, 2024|archive-date=March 27, 2020|archive-url=https://web.archive.org/web/20200327160133/https://www.transparency.org/cpi2019|url-status=dead))</ref>

==Labor==
((Main|General Federation of Trade Unions of Korea))
Growth and changes in the structure and ownership pattern of the economy also have changed the labor force. By 1958 individual private farmers, who once constituted more than 70% of the labor force, had been transformed into or replaced by state or collective farmers. Private artisans, merchants, and entrepreneurs had joined state or cooperative enterprises. In the industrial sector in 1963, the last year for which such data are available, there were 2,295 state enterprises and 642 cooperative enterprises. The size and importance of the state enterprises can be surmised by the fact that state enterprises, which constituted 78% of the total number of industrial enterprises, contributed 91% of total industrial output.<ref name="Savada1994"/>

Labor force (12.6 million)—by occupation:<ref>((cite web |url=https://www.cia.gov/the-world-factbook/countries/korea-north/ |title=CIA World Factbook |publisher=CIA |date=June 20, 2014 |access-date=January 15, 2015 |archive-date=August 12, 2015 |archive-url=https://web.archive.org/web/20150812052526/https://www.cia.gov/library/publications/the-world-factbook/geos/kn.html |url-status=live ))</ref>
*Agricultural: 35%
*Industry and services: 65% (2008 est.)

==External trade==

Statistics from North Korea's trade partners are collected by international organizations like the United Nations and the [[International Monetary Fund]], and by the South Korean [[Ministry of Unification]].

It has also been estimated that imports of arms from the Soviet Union in the period 1988 to 1990 accounted for around 30% of North Korea's total imports, and that between 1981 and 1989 North Korea earned approximately $4 billion from the export of arms, approximately 30% of North Korea's total exports in that period. The nominal dollar value of arms exports from North Korea in 1996 was estimated to have been around $50 million.

North Korea's foreign trade deteriorated in the 1990s. After hitting the bottom of $1.4 billion in 1998, it recovered slightly. North Korea's trade total in 2002 was $2.7 billion: only about 50% of $5.2 billion in 1988, even in nominal US dollars. These figures exclude intra-Korean trade, deemed internal, which rose in 2002 to $641 million. During the late 2000s trade grew strongly, almost tripling between 2007 and 2011 to $5.6 billion, with much of the growth being with China.<ref name="ft-20140220"/> By about 2010 external trade had returned to 1990 levels, and by 2014 was near double 1990 levels, with trade with China increasing from 50% of total trade in 2005 to near 90% in 2014.<ref name="38north-20151022">((cite news |url=http://38north.org/2015/10/rfrank102215/ |title=North Korea's Foreign Trade |author=Ruediger Frank |publisher=U.S.–Korea Institute, Johns Hopkins University School of Advanced International Studies |work=[[38 North]] |date=October 22, 2015 |access-date=October 27, 2015 |url-status=dead |archive-url=https://web.archive.org/web/20151025155928/http://38north.org/2015/10/rfrank102215/ |archive-date=October 25, 2015 ))</ref> In 2015, it was estimated that exports to China were $2.3 billion—83% of total exports of $2.83 billion.<ref name=":0">((Cite news|url=https://www.telegraph.co.uk/news/2018/02/23/paper-fuel-north-koreans-endure-widespread-shortages-sanctions/ |archive-url=https://ghostarchive.org/archive/20220112/https://www.telegraph.co.uk/news/2018/02/23/paper-fuel-north-koreans-endure-widespread-shortages-sanctions/ |archive-date=January 12, 2022 |url-access=subscription |url-status=live|title=From paper to fuel, North Koreans endure widespread shortages as sanctions take their toll|last=Ryall|first=Julian|date=February 23, 2018|work=The Daily Telegraph|access-date=February 23, 2018|language=en-GB|issn=0307-1235))((cbignore))</ref>

In addition to Kaesŏng and Kŭmgang-san, other special economic areas were established at [[Sinuiju Special Administrative Region|Sinŭiju]] in the northwest (on the border with China), and at [[Rason|Rasŏn]] in the northeast (on the border with China and Russia).

[[Sanctions against North Korea|International sanctions]] impeded international trade to some degree, many related to [[North Korea and weapons of mass destruction|North Korea's development of weapons of mass destruction]]. United States President [[Barack Obama]] approved an executive order in April 2011 that declared "the importation into the United States, directly or indirectly, of any goods, services, or technology from North Korea is prohibited".<ref>((cite web|url=http://www.heritage.org/Research/Reports/2011/10/The-US-Korea-Trade-Deals-Time-Has-Finally-Come |title=The U.S.–Korea Trade Deal's Time Has Finally Come |publisher=The Heritage Foundation |date=October 5, 2011 |access-date=October 9, 2011 |url-status=live |archive-url=https://web.archive.org/web/20111009015838/http://www.heritage.org/Research/Reports/2011/10/The-US-Korea-Trade-Deals-Time-Has-Finally-Come |archive-date=October 9, 2011 ))</ref> Operational sanctions included [[United Nations Security Council Resolution]]s [[United Nations Security Council Resolution 1695|1695]], [[United Nations Security Council Resolution 1718|1718]], [[United Nations Security Council Resolution 1874|1874]], [[United Nations Security Council Resolution 1928|1928]], [[United Nations Security Council Resolution 2087|2087]],<ref>((cite web|url=https://www.un.org/ga/search/view_doc.asp?symbol=S/RES/2087(2013) |title=Resolution 2087 (2013) |publisher=[[United Nations Security Council]] |date=January 22, 2013 |access-date=January 7, 2014 |url-status=live |archive-url=https://web.archive.org/web/20131026045436/http://www.un.org/ga/search/view_doc.asp?symbol=S%2FRES%2F2087%282013%29 |archive-date=October 26, 2013 ))</ref> and [[United Nations Security Council Resolution 2094|2094]].<ref>((cite web|url=https://www.un.org/ga/search/view_doc.asp?symbol=S/RES/2094(2013) |title=Resolution 2094 (2013) |publisher=United Nations Security Council |access-date=January 7, 2014 |url-status=live |archive-url=https://web.archive.org/web/20131226010912/http://www.un.org/ga/search/view_doc.asp?symbol=S%2FRES%2F2094%282013%29 |archive-date=December 26, 2013 ))</ref> Reports in 2018 indicated that trade sanctions (bans on almost all exports and the freezing of overseas accounts) were seriously affecting the economy. The main paper [[Rodong Sinmun]] was running short of paper and was publishing only a third of its normal print run, two energy plants supplying electricity to Pyongyang had to be shut down intermittently due to lack of coal, causing blackouts, coal mines were operating under capacity due to lack of fuel, coal could not be transported due to lack of fuel and food rations had been cut by half.<ref name=":0" />

The [[Taep'oong International Investment Group of Korea]] is the official company that manages oversea investments to North Korea.

After 1956, North Korea reached out to the [[Third World]] in the hope of making trade deals. However, according to analyst Benjamin R Young: "In the end, this approach proved ineffective, and Pyongyang never succeeded in developing robust trade relations with the [[Global South]] — a situation that appears unlikely to change anytime soon".<ref>((cite news|url=https://www.nknews.org/2021/12/north-korean-capitalisms-failure-in-the-third-world/|title=North Korean capitalism's failure in the Third World|first=Benjamin R|last=Young|date=December 2, 2021|publisher=[[NK News]]|access-date=December 4, 2021|archive-date=January 29, 2023|archive-url=https://web.archive.org/web/20230129180247/https://www.nknews.org/2021/12/north-korean-capitalisms-failure-in-the-third-world/|url-status=live))</ref>

===North–South economic ties===
North and South Korea's economic ties have fluctuated greatly over the past 30 years or so. In the late 1990s and most of the 2000s, north–south relations warmed under the [[Sunshine Policy]] of President [[Kim Dae-jung]]. Many firms agreed to invest in North Korea, encouraged by the South Korean government's commitment to cover their losses, should investment projects in the north fail to become profitable.((Citation needed|date=July 2010))

Following a 1988 decision by the South Korean Government to allow trade with the North (see [[Foreign relations of North Korea#Reunification Efforts Since 1971|Reunification efforts since 1971]]), South Korean firms began to import North Korean goods. Direct trade with the South began in the fall of 1990 after the unprecedented September 1990 meeting of the two Korean Prime Ministers. Trade between the countries increased from $18.8 million in 1989 to $333.4 million in 1999, much of it processing or assembly work undertaken in the North.

During this decade, the chairman of the South Korean company [[Daewoo]] visited North Korea and reached agreement on building a light industrial complex at [[Nampo|Namp'o]]. In other negotiations, [[Hyundai Asan]] obtained permission to bring tour groups by sea to [[Kumgang-san|Kŭmgang-san]] on the North Korea's southeast coast (see [[Kumgang-san Tourist Region|Kŭmgang-san Tourist Region]]), and more recently to construct the ((convert|800|acre|km2)) [[Kaesong Industrial Park|Kaesŏng Industrial Park]], near the [[Korean Demilitarized Zone]] (DMZ), at a cost of more than $1 billion.

In response to the summit between [[Kim Jong Il]] and Kim Dae-jung in 2000, North and South Korea agreed in August 2000 to reconnect the section of the [[Seoul]]–[[Pyongyang]] [[Gyeongui Line|Gyeongui Railway Line]] across the DMZ. In addition, the two governments said they would build a four-lane highway bypassing the truce village at [[Panmunjeom]].

TV commercials for [[Samsung]]'s [[Anycall]] cell phone featuring North Korean dancer [[Cho Myong-ae]] and South Korea's [[Lee Hyo-ri]] were first broadcast on June 11, 2006.<ref>[https://web.archive.org/web/20110719200207/http://www.korea-is-one.org/article.php3?id_article=2333 "Commercial unites stars from both sides of Korea"]. ''Korea is one''. June 3, 2006.</ref>

Trade with South Korea declined after [[Lee Myung-bak]] was elected [[President of South Korea]] in 2008, who reduced trade to put pressure on North Korea over nuclear matters. Trade with South Korea fell from $1.8 billion to $1.1 billion between 2007 and 2013, most of the remaining trade being through the [[Kaesŏng Industrial Park]].<ref name="ft-20140220">((cite news|url=http://www.ft.com/cms/s/0/f8fca490-9a23-11e3-a407-00144feab7de.html |title=South Korea has lost the North to China |author=Aidan Foster-Carter |newspaper=Financial Times |date=February 20, 2014 |access-date=April 1, 2014 |url-status=live |archive-url=https://web.archive.org/web/20140306054846/http://www.ft.com/cms/s/0/f8fca490-9a23-11e3-a407-00144feab7de.html |archive-date=March 6, 2014 ))</ref> The Park has been subject to frequent shutdowns due to political tensions.

===China===
((main|China–North Korea relations #Trade))

With the collapse of the Soviet Union, China has been North Korea's primary trading partner. Bilateral trade rose sharply after 2007. In 2007 trade between the two countries was $1.97 billion (₩1.7 trillion). By 2011 trade had increased to $5.6 billion (₩5.04 trillion).<ref>((cite news|url=http://www.chinapost.com.tw/business/asia/korea/2012/12/28/365546/N-Koreas.htm |title=N. Korea's China trade nearly triples in 4 years |work=[[China Post]] |date=December 28, 2012 |access-date=January 7, 2014 |url-status=live |archive-url=https://web.archive.org/web/20140107162830/http://www.chinapost.com.tw/business/asia/korea/2012/12/28/365546/N-Koreas.htm |archive-date=January 7, 2014 ))</ref> Trade with China represented 57% of North Korea's imports and 42% of exports.

Chinese statistics for 2013 indicate that North Korean exports to China were nearly $3 billion, with imports of about $3.6 billion.<ref name="ft-20140220"/> Exports to China in 2015 were estimated at $2.3 billion.<ref name=":0" />

===Joint ventures===
Some South Korean companies launched joint ventures in areas like animation and computer software, and Chinese traders have done a booming business back and forth across the [[China–North Korea border]]. In a 2007 survey of 250 Chinese operations in North Korea, a majority reported paying bribes.<ref>((cite magazine|url=https://www.forbes.com/forbes/2011/1024/feature-invade-north-korea-cola-gabriel-schulze-gady-epstein_2.html |title=Invading North Korea |magazine=Forbes |date=October 24, 2011 |access-date=October 9, 2011 |url-status=dead |archive-url=https://web.archive.org/web/20111009090524/http://www.forbes.com/forbes/2011/1024/feature-invade-north-korea-cola-gabriel-schulze-gady-epstein_2.html |archive-date=October 9, 2011 ))</ref> Robert Suter, who headed the Seoul office of Swedish-Swiss power generation company [[ABB]], says ABB was staking out a position in North Korea, "It is the same as it was in China years ago. You had to be there and you had to build trust." A number of South Korean enterprises were mainly active in a specially developed industrial zone in [[Kaesong Industrial Region]] and Chinese enterprises were known to be involved in a variety of activities in trade and manufacturing in North Korea. European enterprises founded in 2005 the European Business Association (EBA), Pyongyang, a ''de facto'' [[chamber of commerce]] representing a number of European-invested joint ventures and other businesses.<ref>"Pyongyang Business Group celebrates 1st anniversary". ''[[The Korea Herald]]''. April 28, 2006.</ref> [[Ch'ongryŏn]], the pro-North Korean General Association of Korean Residents in Japan, broadcast on their TV channel in 2008 a TV film in three parts featuring foreign investment and business in North Korea. This film was put on a [[YouTube]] channel called "[https://www.youtube.com/user/BusinessNK BusinessNK]" and could be watched together with a number of other videos on foreign joint ventures as well as other investment and business activities in North Korea.

Though no international banks operated in the isolated socialist state in 2013, foreign companies were said to be increasingly interested in dealing with North Korea.<ref name="baron-20130311">((cite web |url=http://38north.org/2013/03/jbaron031113/ |title=Book Review: A CAPITALIST IN NORTH KOREA |author=Jeff Baron |work=[[38 North]] |publisher=School of Advanced International Studies |date=March 11, 2013 |access-date=March 11, 2013 |url-status=dead |archive-url=https://web.archive.org/web/20130313063643/http://38north.org/2013/03/jbaron031113/ |archive-date=March 13, 2013 ))</ref>

A flat LCD television factory in North Korea was funded by the Ch'ongryŏn in 2010.<ref>((cite news|first=Seong-Jin |last=Kim |script-title=ko:"평양서 슬림.평면형 TV 인기"<조선신보> |date=January 20, 2010 |url=http://www.yonhapnews.co.kr/politics/2010/01/19/0511000000AKR20100119223000014.HTML |work=[[Yonhap News Agency]] |access-date=January 31, 2010 |language=ko |url-status=live |archive-url=https://web.archive.org/web/20110610141118/http://www.yonhapnews.co.kr/politics/2010/01/19/0511000000AKR20100119223000014.HTML |archive-date=June 10, 2011 ))</ref>

The [[Rason Special Economic Zone]] was established in the early 1990s, in the northeastern corner of the country bordering China and Russia. In June 2011, an agreement with China was made to establish a joint free trade area on North Korea's [[Hwanggumpyong Island|Hwanggumpyong]] and [[Wihwa Island]]s and China's border area near [[Dandong]].<ref name="38north-20100729">((cite web|url=http://38north.org/2012/02/hgp021712/ |title=China's Embrace of North Korea: The Curious Case of the Hwanggumpyong Island Economic Zone |author1=Robert Kelley |author2=Michael Zagurek |author3=Bradley O. Babson |work=[[38 North]] |publisher=U.S.–Korea Institute, Johns Hopkins University School of Advanced International Studies |date=February 19, 2012 |access-date=March 1, 2012 |url-status=live |archive-url=https://web.archive.org/web/20120224134715/http://38north.org/2012/02/hgp021712/ |archive-date=February 24, 2012 ))</ref>
North Korea designated over a dozen new [[Special economic zone (North Korea)|special economic zones]] in 2013 and 2014.<ref name="38north-20180716">((cite web |author=Benjamin Katzeff Silberstein, [[Patrick M. Cronin]] |date=July 16, 2018 |title=How the North Korean Economy Should – and Shouldn't – be Used in Negotiations |url=https://www.38north.org/2018/07/bksilbersteinpcronin071618/ |access-date=July 24, 2018 |work=[[38 North]] |publisher=The Henry L. Stimson Center |archive-date=July 23, 2018 |archive-url=https://web.archive.org/web/20180723183642/https://www.38north.org/2018/07/bksilbersteinpcronin071618/ |url-status=live ))</ref>

==See also==
((Portal|North Korea|Economics))
* [[North Korea–United States summit (disambiguation)|North Korea–United States summit]]
* [[Illicit activities of North Korea]]
* [[Inter-Korean summit]]
* [[Chollima Movement]]
* [[Taxation in North Korea]]
* [[Poverty in North Korea]]

==References==
((Reflist|30em))
*[[Felix Abt]]. ''North Korea&nbsp;— a demanding business environment. Advice on investing and doing business'', Hamburg: German Asia-Pacific Business Association, 2009
*Cumings, Bruce. ''Korea's place in the Sun: a Modern history'', New York: WW Norton and company, 2005.
*Reese, D. ''The prospects for North Korea's survival'', London: International Institute for Strategic Studies, 1998.
*Savada, Andrea Matles. "North Korea: A Country Study." Washington: Library of Congress, 1994.

==Notes==
((reflist|group=note))

==External links==
((Commons category|Economy of North Korea))
* [https://web.archive.org/web/20080620201940/http://www.korea-dpr.com/users/switzerland/international_trade_office_korea/itok_index.php International Trade Office of Korea] Full of information on investments in North Korea.
*[http://www.nkeconwatch.com North Korean Economy Watch] ((Webarchive|url=https://web.archive.org/web/20111206221010/http://www.nkeconwatch.com/ |date=December 6, 2011 ))
*[https://web.archive.org/web/20051025231200/http://www.wfp.org/country_brief/indexcountry.asp?region=5&section=9&sub_section=5&country=408 World Hunger – Korea (DPR)], [[World Food Programme]]
*[https://www.washingtonpost.com/wp-dyn/content/article/2005/05/11/AR2005051100527.html Despite U.S. Attempts, N. Korea Anything but Isolated], ''[[The Washington Post]]'', May 12, 2005
*[http://www.csmonitor.com/2005/0602/p07s02-woap.html On North Korea's streets, pink and tangerine buses], ''[[The Christian Science Monitor]]'', June 2, 2005
*[http://www.nyu.edu/globalbeat/syndicate/crowell062705.html North Korea on the rebound], Global Beat Syndicate, June 27, 2005
*[http://38north.org/2012/07/rfrank071612/ A Question of Interpretation: Economic Statistics From and About North Korea] ((Webarchive|url=https://web.archive.org/web/20120721144505/http://38north.org/2012/07/rfrank071612/ |date=July 21, 2012 )), Ruediger Frank, 38 North, School of Advanced International Studies, July 16, 2012
*[http://www.koreasociety.org/dmdocuments/2008-02-12-smith-hazel-north-korea-market-poverty.mp3 Korea Society Podcast: North Korea: Market Opportunity, Poverty and the Provinces] ((Webarchive|url=https://web.archive.org/web/20150621110225/http://www.koreasociety.org/dmdocuments/2008-02-12-smith-hazel-north-korea-market-poverty.mp3 |date=June 21, 2015 ))
*[http://www.environmental-expert.com/news/north-korea-lifts-the-veil-on-its-agroforestry-practices-297469 "North Korea lifts the veil on its agroforestry practices "]
*[http://www.worldagroforestry.org/af2/?q=node/444 "Agroforestry is not rocket science but it might save DPR Korea"] ((Webarchive|url=https://web.archive.org/web/20160329003744/http://worldagroforestry.org/af2/?q=node/444 |date=March 29, 2016 ))
**[https://rd.springer.com/article/10.1007/s10457-012-9501-0 "Participatory agroforestry development for restoring degraded sloping land in DPR Korea"]

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Return to Economy of North Korea.
Retrieved from "https://en.wikipedia.org/wiki/Economy_of_North_Korea"