North Korea Economy KDI Review of the North Korean Economy, January 2025 February 04, 2025

- Summary
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The January issue assesses North Korea’s 2024 economy and outlook for 2025. Externally, North Korea strengthened economic cooperation with Russia, expanded trade with China, and sought to enhance its bargaining power with the U.S. Its deepening ties with Russia served as a strategic buffer, reinforcing its external policy stance. Domestically, the "20×10 Local Development Policy" aimed to reduce regional disparities but was hindered by fiscal constraints. Market instability persisted, while state intervention in distribution channels drove up prices, potentially escalating tensions between the state and market forces. As the Five-Year Plan concludes in 2025, production targets take priority, with large-scale output campaigns expected. The government is likely to declare the plan’s completion and announce a new strategy at the 9th Party Congress. Despite food production remaining at typical levels, capital shortages and tighter state control over food distribution could disrupt markets and fuel discontent. In 2025, North Korea will strengthen economic ties with Russia and China while resisting inter-Korean or U.S. negotiations without major concessions. Uncertainty will persist throughout 2025, with economic volatility, international sanctions, and exchange rate fluctuations shaping the country’s economic trajectory.
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