North Korea Maintaining Economic Growth

SOURCEInSerbia

Long the target of crippling international trade restrictions, North Korea seems to have found a way to grow its economy and generate funds to support its controversial weapons programmes.

Experts say that the secret is the hermit kingdom’s slow embrace of free markets. They estimate that the North Korean economy could be growing between 1% and 5% annually. Under President Kim Jong-un (in power since 2011), the Asia-Pacific nation has witnessed the spread of markets. According to experts, the growth happened in both informal economy and in official, government-approved market places.

The New York Times recently reported that the number of government-approved markets, like shopping centres, has doubled since 2010. According to satellite images, there are now 440 government-approved markets in North Korea. As a result, more than a million people have found employment as retailers or managers in these markets. The New York Times also reported that at least 40% of the population is now involved in “some form of private enterprise”.

Even people can find Coca-Cola, once lambasted as a “cesspool water of capitalism” by the state propaganda, in some grocery stores in North Korea. Also, there has been a boom in construction and cars in the capital city of Pyongyang and more than three million people use cell phones in the country.

Experts are of the opinion that President Kim’s apparent attention to economic growth could be a useful thing for America to keep in mind in dealings with Pyongyang. About 80% of consumer goods in North Korean markets come from China, giving Beijing great power over Pyongyang. The communist country’s slow embrace of free markets offers the hope that it would discontinue its nuclear weapons, if it can be convinced to open its borders to trade.

However, there is still nothing to suggest that the quality of life for most North Koreans is anything other than nightmarish. According to the UN, about 70% of the population relies on food aid and 40% of the country is malnourished. In 2014, North Korea’s GDP was USD 40 billion. The country exported items worth USD 4,152 billion in 2015 and its main export partner was China (75.8%). In that year, North Korea imported products worth USD 4,819 billion mainly from China (76.4%). It would have been difficult for Pyongyang to maintain an economic growth without the help of Beijing.

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