N. Korea economy poised for growth amid easing of COVID-19 restrictions, increased trade with China
Date
7/28/2024 6:01:11 AM
(MENAFN) After three consecutive years of economic contraction, North Korea's Economy is set to experience substantial growth in 2023, primarily driven by increased trade with China following the easing of COVID-19-related border restrictions. South Korea's central bank, one of the most reliable sources of economic data for North Korea, estimated on Friday that North Korea's gross domestic product (GDP) is expected to grow by 3.1 percent in real terms, marking the highest growth rate since 2016.
The bank of Korea's assessment attributes this growth to several factors, including the relaxation of COVID-19 restrictions, which have facilitated a resurgence in trade with China, as well as favorable weather conditions that have likely supported agricultural output. Despite ongoing economic sanctions, these factors have collectively enabled North Korea's economy to rebound.
In contrast, North Korea's economy contracted by 0.2 percent in 2022, 0.1 percent in 2021, and a significant 4.5 percent in 2020, largely due to stringent COVID-19 measures and United Nations sanctions. However, recent developments, including a renewed focus on trade and investment cooperation with Russia, have further bolstered economic prospects. Last month, North Korea and Russia signed a joint defense pact and agreed to expand their cooperation in trade, economy, and investment during Russian President Vladimir Putin's visit to Pyongyang.
The central bank's report highlights that North Korea's trade with China constituted 98.3 percent of its total trade volume in 2023. The country's exports surged by 104.5 percent, driven by products such as shoes, hats, and wigs, while imports increased by 71.3 percent, reflecting a growing demand for fertilizers and other essential goods. These trade dynamics underscore the pivotal role of China in North Korea's economic recovery and growth trajectory.
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