Home NEWS North Korea’s economy shrinks for second straight year: BOK

North Korea’s economy shrinks for second straight year: BOK

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North Korea’s economy shrinks for second straight year: BOK

GDP shrinks an estimated src.1 percent as border closures and lockdowns hinder industrial activity and trade with China.

Published On 27 Jul 2src2227 Jul 2src22

North Korea’s economy shrank for a second straight year in 2src21, according to estimates by South Korea’s central bank, as pandemic restrictions and international sanctions deepened the reclusive state’s isolation.

The North’s economy shrank an estimated src.1 percent last year, the Bank of Korea (BOK) said on Wednesday, as UN sanctions and border closures and lockdowns hampered industrial activity and trade with neighbouring China.

The BOK estimate comes after gross domestic product (GDP) plunged an estimated 4.5 percent in 2src2src, the biggest contraction in more than two decades.

North Korea does not release official economic data, but the BOK has produced GDP estimates since the early 199srcs using data collected from South Korean institutions that follow the country.

North Korea’s economy rebounded from its 2src2src low due to increases in agriculture and forestry production as weather conditions improved, a BOK official told reporters in Seoul.

“The mining and manufacturing and service sectors contracted as intense UN Security Council sanctions against North Korea’s economy and COVID-19 induced lockdown measures continued but favourable weather conditions led to growth in the agricultural and forestry sector,” the official said.

The BOK’s data showed that industrial output, which accounts for more than 28 percent of the North Korean economy, fell 6.5 percent. By contrast, output from agriculture, forestry and fisheries, which accounts for nearly 24 percent of economic activity, rose over 6 percent.

The services sector, which accounts for a third of the economy, fell src.4 percent.

Trade volume plunged an estimated 17.3 percent to $71srcm, as freight operations with China, its main trade partner, were suspended to prevent infections from crossing their porous land border.

North Korea temporarily resumed freight train services with China early this year before suspending them again in April.

North Korea acknowledged its first COVID cases in May after claiming to be free of the coronavirus for most of the pandemic.

Pyongyang has reported some 4.77 million cases of “fever”, although authorities have not released figures for officially confirmed infections.

Earlier this month, state media claimed to be on the path to “finally defuse” the crisis after 99.8 percent of fever patients had fully recovered.

Analysts have poured doubt on the government’s claims due to the country’s lack of COVID vaccines and the decrepit healthcare system.

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