North Korea’s Economy Is Apparently Booming

The most sanctioned country in the world is wriggling out of its economic constraints. Though North Korea remains overwhelmingly impoverished, its capital city has transformed in just a few short years thanks to deepened international partnerships, especially with China and Russia. Chinese President Xi Jinping arrived in North Korea yesterday for the first time in seven years.

A lot has changed since Xi’s last visit. For starters, tourists recently told the Wall Street Journal and the New York Times that Pyongyang suddenly feels more modernized, with far more cars, smartphones, and people using delivery apps than just a few years ago.

By the numbers:

• North Korea’s economy grew by 3.7% in 2024, its fastest rate in eight years, according to the South Korean central bank.
• Construction is booming. North Korea built 10,000 new homes in the capital city last year and finished building Pyongyang’s largest hospital, plus a Central Park-sized greenhouse and a beach resort.
• All this growth is visible from the sky. Satellite data shows that North Korea is now about three times brighter at night than it was five years ago, WSJ reported.

What happened?

North Korea’s pandemic-era slump, which included widespread food shortages, began to turn around after Russia invaded Ukraine in 2022. North Korea made $10+ billion from the summer of 2023 through the end of last year by selling munitions to Moscow and sending troops, according to the think tank INSS.

Separately, North Korean hackers have siphoned billions of dollars from crypto exchanges to the regime in recent years.

Now, China likely wants to remind North Korea that it’s a crucial trade partner, but North Korea’s budding relations with Russia also give Kim Jong Un more leverage in meeting with Xi. Still, monthly trade with China recently hit an eight-year high as more tech products enter North Korea.

Zoom out: North Korean GDP is less than 1% of US GDP, and most of North Korea’s growth is happening in Pyongyang. Nearly half of its 26 million residents are malnourished, according to the UN.—ML

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