North Korea’s economy, which had contracted for three consecutive years from 2020 to 2022, is estimated to have achieved its strongest growth in eight years last year. Analysts attribute this to the “war boom,” as Pyongyang dispatched large-scale troops and supplied weapons to Russia amid the war in Ukraine.
On the 29th, the Bank of Korea released its report “Estimated North Korean Economic Growth Rate for 2024”, projecting that North Korea’s economy grew by 3.7% in 2024 — the highest since a 3.9% expansion in 2016. The Bank of Korea has estimated North Korea’s growth annually since 1991, based on basic data collected from related institutions.
North Korea’s economy shrank for three years in a row during the COVID-19 pandemic — 2020 (-4.5%), 2021, and 2022 — before returning to growth in 2023 (3.1%), its first expansion in four years. It has now recorded back-to-back growth of over 3% for two consecutive years.
According to the Bank of Korea, manufacturing output rose 7% year-on-year, construction 12.3%, and mining 8.8%. Agriculture, forestry, and fisheries declined by 1.9%.
Woo Joon-myung, head of the BOK’s North Korea Economy Research Office, said:
“North Korea’s fundamental economic base is weak, but as COVID-19 lockdowns were lifted and exchanges with China increased, the economy was at a rebound stage. On top of that, the war boom boosted weapons exports, driving growth in manufacturing.”
He added: “We’ve observed that while rice prices in North Korea rose, wheat prices did not. This suggests there was some form of economic cooperation with Russia.”
On August 8, the Korea Institute for Defense Analyses estimated that North Korea may have reaped up to 28.7 trillion won (about USD 21 billion) in economic benefits in return for sending troops and weapons to Russia. This amount could feed the entire North Korean population for six years.
Last year, North Korea’s per capita Gross National Income (GNI) stood at 1.719 million won, up 8.2% from the previous year — about 1/29th of South Korea’s (50.12 million won).
Meanwhile, although North Korea’s exports increased last year, imports declined, shrinking its overall trade volume by 2.6% to USD 2.7 billion. Exports rose 10.8% to USD 360 million, led by wigs and false eyelashes, as well as industrial raw materials such as minerals, slag, and ash. Imports fell 4.4% to USD 2.34 billion, mainly due to decreases in fertilizer and grain.
Posted by Freewhale98