Kim Jong Un acknowledges dire state of economy, urges action

But N Korea’s economy may see gains in 2024, fueled by tourism, stronger ties with China, Russia: South think tank
By Lee Jeong-Ho for RFA
2024.01.24
Seoul, South Korea
Kim Jong Un acknowledges dire state of economy, urges action North Korean leader Kim Jong Un attends the 19th expanded political bureau meeting of the 8th Central Committee of the Workers’ Party of Korea, which was held from Jan. 23 to 24, in Pyongyang, North Korea, in this image released by the Korean Central News Agency on Jan. 25, 2024.
KCNA via Reuters

North Korea’s leader Kim Jong Un made a rare acknowledgement on the dire state of his country’s economy, urging ruling party officials to take immediate action.

Speaking at the two-day party meeting, which began Tuesday, Kim labeled the economic problem as a “serious political issue,” saying that his government revealed the “inability to provide even basic necessities such as basic foodstuffs, groceries, and consumer goods to the local people.”

“The overall local economy is currently in a very pitiful state, lacking even basic conditions,” Kim said at a politburo plenary meeting, as cited by the North’s state-run Korean Central News Agency Thursday.

North Korean regimes consistently focus on their economy and food security, recognizing that economic performance is closely linked to the country’s security and legitimacy. 

Kim has been facing issues related to the economy and food shortages since he assumed power in 2012. These problems have been intensified recently amid climate change, the aftermath of COVID-19, and international sanctions.

North Korea’s economy contracted for the third consecutive year in 2022, according to the South’s Statistics Korea report in December. The latest available data showed a 0.2% year-on-year drop in North Korea’s GDP in 2022, following a 0.1 % decrease in 2021, and a 4.5 % contraction in 2020.

Meanwhile, North Korea’s agricultural production experienced a 4% year-on-year decline in 2022, totaling 4.5 million tons, according to the Statistics Korea report. Specifically, rice production saw a decrease of 3.8%, amounting to 2.07 million tons, which is approximately half of South Korea’s rice production.

Sources inside North Korea told Radio Free Asia in May that as many as 30% of farmers in two northern provinces were unable to work on collective farms because they’re weak from hunger.

Urging improvements in the economic situation, Kim scolded his party officials, urging them to take immediate action. 

“Some policy guidance departments and economic institutions have been evading the reality of the situation and engaging in discussions without actively seeking realistic and revolutionary solutions to address this task.

“If we cannot effectively implement the party’s economic development policies, we will never realize significant changes,” Kim said.

A separate report by the South’s Korea Development Institute (KDI) released in December, however, noted that there may be some “tangible achievements” in North Korea’s economy this year, boosted by the resumption of tourism with China and strengthened economic cooperation with Russia.

“Currently, North Korea is in the midst of reviving its collaboration with China, including tourism and personnel exchanges. Moreover, the nation is strengthening its partnership with Russia to an unprecedented level,” the KDI report said.

North Korea’s primary economic objectives for 2024 would be centered around “acquiring foreign currency to address the trade deficit, discovering new export opportunities, revitalizing and expanding tourism cooperation with China and Russia,” the report said. 

Edited by Taejun Kang and Mike Firn.

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