Economic Outline

flag North Korea North Korea: Economic Outline

Economic Indicators

North Korea is one of the world's least open countries. The government mainly administers a system of centralized 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 East Asia Forum, in 2023, North Korea witnessed economic regression as state control over the economy intensified, prioritizing political goals over improving living standards. Concurrently, North Korea bolstered ties with Russia, exporting military equipment to support its ally in the Ukraine conflict. Domestically, North Korea heightened its reliance on heavy industries despite their inefficiencies and lack of global competitiveness.

North Korea does not release official statistics on its economy except for an annual budget report. The country's five-year plan approved in January 2021 is aimed at strengthening self-sufficiency and consolidating central power. The agricultural sector accounts for more around 22.5% 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 ongoing systemic problems, including a lack of arable land, collective farming practices, poor soil quality, insufficient fertilization, and persistent shortages of tractors and fuel. According to data from the CIA, industry accounts for 47.6% of the national GDP, whereas the services sector has a 29.9% share (latest data available).

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. Around half of the country's population is estimated to live in extreme poverty and suffers from malnutrition.


Monetary Indicators 20152016201720182019
North Korean Won (KPW) - Average Annual Exchange Rate For 1 MUR 3.713.663.923.98n/a

Source: World Bank - Latest available data.


Main Sectors of Industry

Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 43.5 14.2 42.3

Source: World Bank - Latest available data.


The Active Population in Figures

Labour Force 16,471,50216,567,35616,371,651

Source: International Labour Organization, ILOSTAT database

Total activity rate 86.50%86.45%86.24%
Men activity rate 91.51%91.56%91.41%
Women activity rate 81.46%81.31%81.05%

Source: International Labour Organization, ILOSTAT database


Return to top

Indicator of Economic Freedom


The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

World Rank:
Regional Rank:

Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation


Country Risk

See the country risk analysis provided by Coface.


Indicator of Political Freedom


The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.

Not Free
Political Freedom:

Political freedom in the world (interactive map)
Source: Freedom in the World Report, Freedom House


Indicator of Freedom of the Press


The world rankings, published annually, measures violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire incorporating the main criteria (44 in total) to assess the situation of press freedom in a given country. This questionnaire was sent to partner organisations,150 RWB correspondents, journalists, researchers, jurists and human rights activists. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).

World Rank:

Return to top

Sources of General Economic Information

Useful Resources
Official webpage of North Korea
Official website of the government of North Korea
Info on the Central Bank of the Democratic People's Republic of Korea

Return to top

Any Comment About This Content? Report It to Us.


© eexpand, All Rights Reserved.
Latest Update: May 2024