communist country because of the small size
and homogeneity of the society and the strict rule of KIM Il-song in
the past and now his son, KIM Chong-il. Economic growth during the
period 1984-88 averaged 2%-3%, but output declined by an average of
4%-5% or more annually during 1989-97 because of systemic problems and
disruptions in economic and technological links with the former USSR
and China. The leadership has insisted on maintaining its high level
of military outlays from a shrinking economic pie. Moreover, a serious
drawdown in inventories and critical shortages in the energy sector
have led to increasing interruptions in industrial production.
Abundant mineral resources and hydropower have formed the basis of
industrial development since World War II. Manufacturing is centered
on heavy industry, including military industry, with light industry
lagging far behind. Despite the use of improved seed varieties,
expansion of irrigation, and the heavy use of fertilizers, North Korea
is not yet self-sufficient in food production. Indeed, a shortage of
arable lands, several years of poor harvests, systemic inefficiencies,
a cumbersome distribution system, and extensive floods in 1995-96
followed by a severe drought in 1997 have resulted in increasingly
serious food shortages. Substantial grain shipments from Japan and
South Korea are offsetting a portion of the losses. North Korea
remains far behind South Korea in economic development and living
standards.

GDP: purchasing power parity-$21.8 billion (1997 est.)

GDP-real growth rate: -3.7% (1997 est.)

GDP-per capita: purchasing power parity-$900 (1997 est.)

GDP-composition by sector:
agriculture: 25%
industry: 60%
services: 15% (1995 est.)

Inflation rate-consumer price index: NA%

Labor force:
total: 9.615 million
by occupation: agricultural 36%, nonagricultural 64%

Unemployment rate: NA%

Budget:
revenues: $19.3 billion
expenditures: $19.3 billion, including capital expenditures of $NA
(1992 est.)

Industries: military products; machine building, electric power,
chemicals; mining (coal, iron ore, magnesite, graphite, copper, zinc,
lead, and precious metals), metallurgy; textiles, food processing

Industrial production growth rate: -7% to -9% (1992 est.)

Electricity-capacity: 9.5 million kW (1995)

Electricity-production: 35.2 billion kWh (1995)

Electricity-consumption per capita: 1,499 kWh (1995)

Agriculture-products: rice, corn, potatoes,