North Korea is routinely described as a “starving Stalinist economy,” but this oft-repeated cliché is both outdated and misleading. To start with, North Korea has a large private sector, which is now believed to be responsible for a large share of the country’s small GDP – between 25 percent and 40 percent, depending on whose estimates you believe. Second, it is not starving: The last decade was a time of modest but noticeable economic growth. The pessimists in the Bank of (South) Korea estimate the annual growth at paltry 1.3-1.5 percent while optimists (largely in the embassies located in Pyongyang) put the figure higher, believing it to be close to 3 or even 4 percent.
At any rate, North Korean economy is growing, both in the privileged capital and in the countryside. Changes are visible: People are better dressed, there are more vehicles on the street (and even traffic jams occur sometimes), and a minor restaurant boom is unrolling in Pyongyang while computers – cheap Chinese models, often bought second-hand – are seen as something even teenagers of the mildly affluent families can and should afford.
North Korea is routinely described as a “starving Stalinist economy,” but this oft-repeated cliché is both outdated and misleading. To start with, North Korea has a large private sector, which is now believed to be responsible for a large share of the country’s small GDP – between 25 percent and 40 percent, depending on whose estimates you believe. Second, it is not starving: The last decade was a time of modest but noticeable economic growth. The pessimists in the Bank of (South) Korea estimate the annual growth at paltry 1.3-1.5 percent while optimists (largely in the embassies located in Pyongyang) put the figure higher, believing it to be close to 3 or even 4 percent.
At any rate, North Korean economy is growing, both in the privileged capital and in the countryside. Changes are visible: People are better dressed, there are more vehicles on the street (and even traffic jams occur sometimes), and a minor restaurant boom is unrolling in Pyongyang while computers – cheap Chinese models, often bought second-hand – are seen as something even teenagers of the mildly affluent families can and should afford.
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Andrei Lankov is a Director at NK News and writes exclusively for the site as one of the world's leading authorities on North Korea. A graduate of Leningrad State University, he attended Pyongyang's Kim Il Sung University from 1984-5 - an experience you can read about here. In addition to his writing, he is also a Professor at Kookmin University.
Peter Ward is a senior researcher at Kookmin University, a writer and researcher focusing on the North Korean economy, and holds a Ph.D. from the University of Vienna.