Coreia do Norte : Contexto econômico

Economic Indicators

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North Korea is one of the world's least open countries. The government mainly administers a system of centralised planning and state control of the economy, but has carried out a few market reforms, such as granting greater managerial autonomy to state enterprises and agricultural cooperatives, which would allow them to reinvest profits at their discretion should they achieve the objectives of the plan. The impoverished population is heavily dependent on food rations and government housing subsidies. According to the Bank of Korea (BOK of South Korea), North Korea's economy grew for the first time in three years in 2019 as better weather conditions boosted harvests, but sanctions imposed to stop its nuclear ambitions (in place since 2006) kept manufacturing weak. According to the BOK, GDP in North Korea rose 0.4% in real terms in 2019 compared to 2018, when the economy contracted the most in 21 years, shrinking 4.1% due to a drought and sanctions. However, North Korea's economy shrank by 4.5% in 2020, suffering its biggest contraction since at 1997, amid continued UN sanctions, COVID-19 lockdown measures and worsened weather conditions such as heavy rains and typhoons. North Korean real annual GDP decreased by 0.1% in 2021 (Bank of Korea, 2022). The economy was expected to recover gradually in 2022 and 2023 on the back of trade as borders with China, the almost unique trade partner, reopened in September 2021. Trade surged and doubled between both economies in September 2021.

North Korea does not release official statistics on its economy except for an annual budget report. The country's new five-year plan approved in January 2021 is aimed at strengthening self-sufficiency and consolidating central power. The agricultural sector accounts for more than 20% of GDP and remains largely state-owned. It employs 51.1% of the workforce. Frequent weather-related crop failures (such as the severe drought that hit the country in 2015, which caused a 14% decrease in rice and wheat production of rice) aggravated chronic food shortages caused by on-going systemic problems, including a lack of arable land, collective farming practises, poor soil quality, insufficient fertilisation, and persistent shortages of tractors and fuel.

According to data from the Bank of Korea, mining still accounts for 10% of GDP, although this is a declining trend, as a Chinese ban on coal imports from North Korea continued to weigh on the industry. The weapons production-oriented industrial sector is a major economic driver and the service sector is gaining momentum. In 2019 it accounted for 34% of GDP, five points more than in 2012, although most of the sector's strength is due to state-related services, which account for 74% of the sector's value added.

No effective tax system is in place and the government controls almost every part of the economy, setting production levels for most commodities, and state-owned industries account for nearly all of GDP. Disproportionately high military spending further drains scarce resources. Also, an informal economy has been developing for the last decade and has largely contributed to the country’s fragile economic recovery. It is estimated to represent almost half of the country's GDP (between USD 1 and 3 billion). The United Nations estimates that the nominal GDP per capita in North Korea is among the lowest in the world, ranking it 180th out of 193 countries.

Around half of the country's population is estimated to live in extreme poverty and suffers from malnutrition. Food shortages worsened after the crop harvest hit its worst in 10 years back in 2018. The country receives aid from the World Food Programme (WFP).

Monetary Indicators	2015	2016	2017	2018	2019
North Korean Won (KPW) - Average Annual Exchange Rate For 1 GHS	35.04	32.58	31.03	29.44	n/a

Source: World Bank - Latest available data.

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Latest Update: November 2023