Yo Kass answered
The economy of North Korea relies on the production of military equipment, and the mining of minerals as the biggest contributors to its Gross Domestic Product (GDP).
The country is an exporter of minerals, metallurgy and manufactured products (including armaments), with almost all of its trade being split between China and South Korea.
The country is an exporter of minerals, metallurgy and manufactured products (including armaments), with almost all of its trade being split between China and South Korea.
Contrast of the two Korean economies
Since the division of the Korean peninsula following World War II, North and South Korea have taken very different economic routes.
South Korea (with the support of the Americans) developed a capitalist economy with an open market that has seen the country making significant progress. Since the 1960s, South Korea's economy has gone from strength to strength, and the country is currently ranked as one of the top 15 global economic powers.
In stark contrast, North Korea became a far more insular and reclusive state. Its communist allegiance meant that, with the collapse of its biggest ally the USSR, it struggled economically in the decades following the state's creation.
It is difficult to gauge the full extent of the situation in North Korea due to the country's reluctance to publish reliable information regarding its national income accounts. However, it is known that the country has struggled with widespread famine and poor living conditions in recent years. It has been thought to be on the brink of a hunger epidemic, alleviated only by international food aid deliveries.
South Korea (with the support of the Americans) developed a capitalist economy with an open market that has seen the country making significant progress. Since the 1960s, South Korea's economy has gone from strength to strength, and the country is currently ranked as one of the top 15 global economic powers.
In stark contrast, North Korea became a far more insular and reclusive state. Its communist allegiance meant that, with the collapse of its biggest ally the USSR, it struggled economically in the decades following the state's creation.
It is difficult to gauge the full extent of the situation in North Korea due to the country's reluctance to publish reliable information regarding its national income accounts. However, it is known that the country has struggled with widespread famine and poor living conditions in recent years. It has been thought to be on the brink of a hunger epidemic, alleviated only by international food aid deliveries.
Challenges facing the North Korean economy
As I mentioned earlier, there is a distinct lack of information regarding the way the North Korean economy currently stands.
What we do know is that there are a number of issues that need addressing in order for the country to turn itself around. A major concern is the large-scale cost of maintaining and developing the country's military, which in itself places an unsustainable pressure on the North Korean economy.
According to many Western countries, the other impediments to the economic progress of North Korea are:
What we do know is that there are a number of issues that need addressing in order for the country to turn itself around. A major concern is the large-scale cost of maintaining and developing the country's military, which in itself places an unsustainable pressure on the North Korean economy.
According to many Western countries, the other impediments to the economic progress of North Korea are:
- A tightly controlled and closed economy
- An overly-aggressive foreign policy that makes trade and relations with South Korea strained
- Under-investment in the industrial and agricultural sectors
- A lack of arable land, along with collective farming and susceptibility to weather-related crop failures
