North Korean Economy Watch

The Institute for Far Eastern Studies (IFES) published an interesting paper (with the above title) on legal reform in the DPRK.  Below are some highlights.  Links to the entire paper at the bottom.

As citizens have been left without state provisions for subsistence since the state did not have the material resources to supply the people through its central rationing system, the vast majority of individuals and organizations had to support themselves. Legitimizing commercial and market activity and expanding the scope of private ownership were a part of this effort. One of the most important laws reflecting this transformation is the Damage Compensation Law (sonhae bosang-beop), which is the North Korean version of a general torts law. This law holds an individual or any legal entity liable for its tort when damage is inflicted. Monetary compensation is the rule, while restoration is allowed when possible.

Under the socialist system, where the state is responsible for the provision of a citizen’s livelihood, tort law was of little use. Even in the case of death, one’s family would not suffer economically since the state provided sustenance rations. However, with the collapse of the public distribution system, the North Korean authorities could no longer maintain their socialist system. Since an individual now has to rely on his or her own devices, the loss of the employment, for example, directly inflicts a financial burden on the individual or family. Therefore, damage to property or person should be compensated for by the responsible party. Therefore, the new damage compensation law acts as a new mechanism for the protection of private property, and strengthens individual responsibility for negligent acts that inflict damage on others.

and…

Relaxation of law and order, along with the laxity of organizational control due to economic difficulties, changed individual attitudes toward government authorities and organizations in which these individuals were members. Individuals became more independent from the state and its organizations, since both the state and more directly engaged organizations lost important means of control over individuals in society due to the lack of resources and the inability to provide basic necessities to the people.

Under these circumstances, individual victims had no appropriate method to seek compensation for damage through an official dispute resolution process. This has led to an environment in which self-remedy has become the rule, rather than the exception. Although new criminal law punishes those who have used force in asserting their rights, there is no effective means of dispute resolution outside of taking advantage of officials willing to look the other way in exchange for favors, or hiring thugs to more directly resolve disagreements. Citizens can buy justice through bribes, and law enforcement officials are especially helpful in these endeavors when their palms are greased. This is much more economical as well as effective than bringing a case to the relevant official agency, which is generally incapable of resolving problems and instead further exploits the situation.

On courts and lawyers…

For example, the most prominent role of the court in North Korea, where other types of lawsuit are very unusual, was to handle divorce settlements, since divorce through simple agreement of the two parties was not allowed. Ordinary citizens went so far as to perceive settlement of divorce to be the most important role of the court. Criminal cases were also unusual. Political crime is handled through a non-judicial process, while many deviances are resolved through unofficial processes within more local organizations. The role of the court in resolving disputes was negligible, aside from divorce. Since the role of law enforcement agencies is to protect the state and secure the socialist system, the most important qualification for them is not legal expertise, but rather, loyalty and devotion to the North Korean ideology and system.

On the other hand, the Lawyer’s Act of 1993 prescribes the required qualifications of a lawyer. Those who are eligible to work as lawyers are those who are certified legal professionals, those who have working experience of no less than 5 years in legal affairs, or those who have a professional license in a certain area and have passed the bar examination after a short-term course in legal education. This qualification for working as a lawyer signifies that the state wants to equip the judicial system with legal professionals. Although there is no explicit professional qualification for a judge or prosecutor, we may assume that legal professionals have been elected or recruited in practice. This trend is likely to be reinforced as these social changes continue to unfold.

New provisions were also introduced to reinforce the judicial system. For example, interference with a law enforcement official’s performance of duties is now a punishable offence ; Threatening a witness or exacting revenge has been criminalized ; Non-execution of judgment will now be punished. Although the introduction of these provisions was an expression of the government’s effort to bring in a more effective judicial system, it would not be an easy task under the vague status of transformation. The state is very cautious and reluctant to undertake bold or fundamental changes due to concerns about political instability. Therefore, it takes time for various coherent mechanisms to fully support a market system.

You can download the entire paper in PDF format here.

You can read it on the IFES web page here.

Some great qualitative information on the DPRK’s underground real estate market from Radio Free Asia:

Central authorities are investigating the practice in all of North Korea’s major cities and have confiscated the homes of “dozens” of local officials in the city of Chongjin, one well-informed source who asked not to be named said.

Private ownership or sale of homes is forbidden by the North Korean state, which assigns dwellings to its citizens based on its own determination of need.

“Most government officials build their residences in the North Korean equivalent of suburbs, in areas that are close to the city but still have a rural flavor,” the source, a Chinese merchant who does business in North Korea, said.

“They sell them when they retire.”

“If someone sells a 50-pyong (1,800-square foot) house in such an upscale neighborhood, he can then buy a house that is three or four times bigger in a different area,” the merchant said.

Party and state officials receive permits and order state-run construction companies to build homes in suburban areas near the sea, the merchant said.

He added that the value of real estate privately sold in North Korean port cities is now appreciating at twice the rate of real estate sold elsewhere in the country.

High-quality materials, including expensive appliances and wallpaper, are often used in the building of officials’ homes, according to a North Korean defector originally from Chongjin but now living in South Korea.

“Small but elegant” patios are sometimes also included, he said.

To justify the construction and occupancy of a larger space, local officials build multi-unit structures and fill them with relatives or people of more modest means, the defector said. 

When the officials retire, they pay the other occupants to move and then sell the entire structure.

North Korean authorities have now sent “task forces” to each of North Korea’s major cities to investigate real estate deals by local officials, the border merchant said, adding that a 40-member group was recently sent to Chongjin, where the homes of dozens of officials were seized.

An official in the city’s Songpyong Ward has reportedly been demoted and reassigned to a more backward part of the country, and fines equal to the actual value of transactions have been imposed on citizens who bought or sold homes.

Some thoughts:
1. IFES reported that private real estate transactions were quite common last september.

2. This report, combined with previous accounts, indicates that, although illegal, the DPRK’s real estate market is quite rational.  Construction quality and location influence housing prices.  According to the Daily NK, the qality of the chairman of the neighborhood people’s committee also influences the price.

3. Could the effort to crack down on these transactions be part of the plans to achieve a “Strong and prosperous nation” by 2012?

Read more here:
North Korean Economy Watch: real estate posts

North Korea’s Black-Market Housing
Radio Free Asia
Jung Young
1/23/2009

Private sector real estate activity booming in the DPRK
Institute for Far Eastern Studies (IFES)
NK Brief No. 08-9-4-1
9/4/2008

Who Is the Chairperson of the People’s Unit?
Daily NK
Moon Sung Hwee
8/18/2008

Last week, North Korean Economy Watch reported Pyongyang’s irrational economic policy threats which could end the flow of millions of South Korean dollars into North Korean coffers.  I use the word “irrational” because government policies are typically designed to increase revenues to the treasury (or to coalition / constituent members), not scare them away.  Today, however, North Korea reaffirmed its commitment to closing the border with South Korea on December 1, though with some qualifications:

1. The North Koreans will end “the train to nowhere” (c) NKeconWatch. This is puzzling because of all the inter-Korean projects, this one is the least “contaminating.” The South Korean government pays the North Korean government to send an empty train across the border each day.  Why jeopardize this easy money?

2. The North Koreans will end the Kaesong day tours.  This will not be good for Hyundai Asan (HA), which is already suffering losses from the idle Kumgangsan resort.  On the plus side for HA, since this project merely bussed people around Kaesong, they will not be leaving much fixed capital on the northern side of the DMZ.  Still, it is strange that the North Koreans would seek to end this program.  Although it is slightly “contaminating” in that hundreds of South Koreans are shuffled through Kaesong every day, the North’s citizens are generally isolated from their wealthy neighbors. Additionally, I estimate that this program has grossed the North Koreans nearly USD$10 million since it was launched nearly a year ago. This is not an insignificant amount of money to the DPRK.

3. The ultimate fate of the Kaesong Industrial Zone remains uncertain.  Although the North Koreans have threatened to “selectively expel” up to half of the South Koreans in the facility, some managers remain optimistic:

“(The North) never said it would halt production or expel staff related to the production process. So even in the worst case of operating with only half of the staff, we think there won’t be any problem in production,” said Lee Eun-suk, an official at Shinwon Corp, which has clothing factories at Kaesong. (Reuters, via the Washington Post)

Unless North Korea’s policy makers are terminating the flow of economic rents into the country to curb the power of some particular official or interest group, there are not many instances where these actions could be considered shrewd.  Adding to the confusion, most analysts presume that the majority of the South’s construction and wage fees are distributed to the small cohort of high-ranking North Korean policy makers who ostensibly signed off on the projects in the first place.  So why would they now decide to end their own direct funding?

These policy decisions, moreover, will likely affect the North Koreans in ways they do not yet seem to anticipate, particularly when it comes to attracting private foreign direct investment (which is desperately needed).  Private investors will not be attracted to a business environment where the rules of the game are prone to changing every few months.  Investment entrepreneurs will not risk the appropriation of large scale fixed assets.  International aid and official foreign direct investment will probably go on as usual as these tasks have more to do with political decisions than economic.

So what is going on?  That is the million dollar question, and speculation in this case is not worth all that much.  The Daily NK, however, claims to have interviewed an “official” from Pyongyang who discussed recent developments in the Kaesong Industrial Zone.  His claim is that the North Koreans made the decision to close the Kaesong Zone for internal political reasons:

Q. What is the reason that North Korea is trying to suspend the business in the Kaesong Industrial Complex?

A. In fact, the story about the suspension of the Kaesong Complex has emanated from Pyongyang since this fall, but it had been decided as an instruction of the Party in Pyongyang late last year.

It is hard to say conclusively what is happening in Kaesong, because there are so many complicated things at work. People from the Party in Pyongyang say that the Kaesong Complex and tourism should fall into disuse and the Mt. Geumgang tourism site should be left alone. Whether or not the Kaesong Complex is thrown away is only up to our economy condition and also the General (Kim Jong Il)’s decision.

Q. Do you mean that instructions on the Kaesong Complex have already been decided internally by the Party?

A.Yes, you can say that. This was because at the beginning, they started it on in the precondition of switching workers once a year, but now they know that switching workers every year is impossible.

Additionally, rumors on South Chosun have been constantly circulating among workers and their families, so illusion of the South have now become uncontrollable among the people. The authorities cannot overlook this situation.

From the Party’s view, each worker in Mt. Geumgang and Kaesong is like a poster advertising capitalism. Due to them, our socialist system could be cracked.

As I know, at least 20 affiliates with Kaesong Complex came into questioning for advertising South Chosun and capitalism.

There was a thorough reshuffling in the Party last year. There is nobody who talks about Kaesong or Mt. Geumgang.

Q. Can North Korea ignore the abundant dollars from Kaesong in practice?

A. Frankly speaking, we have relied on it due to money. Even right now, if South Korea treats things like the Mt. Geumgang shooting accident flexibly and starts the tours again, everything is okay. The money we want does not need to come only from South Korea. There are Yuan, Rubles and dollars as well. They are all the same.

Although our economy is so terrible, we will not establish the national vision only targeted on making money. You should bear this point in mind.

Thoughts and opinions apprecaited. 

Read more here:
There Is an Internal Reason for the Bluff on Kaesong
Daily NK
Jung Kwon Ho
11/16/2008

Kaesong Staff to Be Expelled
Daily NK
Kim So Yeol
11/24/2008

Kaesong Tour and Trains are Suspended
Daily NK
Jeong Jae Sung
11/24/2008

North Korea to Halt Cross-Border Rail Service, Tours
Bloomberg
Heejin Koo
11/24/2008

North Korea prepares to shut border with South
Reuters (via Washington Post)
Jonathan Thatcher
11/24/2008

N. Korea Stiffens Diplomatic Stance
New York Times
Choe Sang-hun
11/24/2008

North Korea Uncovered: Version 12
Download it here

About this Project: This map covers North Korea’s agriculture, aviation, cultural locations, markets, manufacturing facilities, energy infrastructure, political facilities, sports venues, military establishments, religious facilities, leisure destinations, national parks, shipping, mining, and railway infrastructure. It is continually expanding and undergoing revisions. This is the 12th version.

Additions include: Tongch’ang-dong launch facility overlay (thanks to Mr. Bermudez), Yongbyon overlay with destroyed cooling tower (thanks to Jung Min Noh), “The Barn” (where the Pueblo crew were kept), Kim Chaek Taehung Fishing Enterprise, Hamhung University of education, Haeju Zoo, Pyongyang: Kim il Sung Institute of Politics, Polish Embassy, Munsu Diplomatic Store, Munsu Gas Station, Munsu Friendship Restaurant, Mongolian Embassy, Nigerian Embassy, UN World Food Program Building, CONCERN House, Czech Republic Embassy, Rungnang Cinema, Pyongyang University of Science and Technology, Pyongyang Number 3 Hospital, Electric Machines Facotry, Bonghuajinlyoso, Second National Academy of Sciences, Central Committee Building, Party Administration Building, Central Statistics Bureau, Willow Capital Food House, Thongounjong Pleasure Ground, Onpho spa, Phipa Resort Hotel, Sunoni Chemical Complex (east coast refinery), Ponghwa Chemical complex (west coast refinery), Songbon Port Revolutionary Monument, Hoeryong People’s Library, Pyongyang Monument to the anti Japanese martyrs, tideland reclamation project on Taegye Island. Additionally the electricity grid was expanded and the thermal power plants have been better organized. Additional thanks to Ryan for his pointers.

I hope this map will increase interest in North Korea. There is still plenty more to learn, and I look forward to receiving your contributions to this project.

Version 12 available: Download it here

UPDATE (2009-10-12): Last September (2008), Barbara Demick at the LA Times became the first US journalist to report on Pyongyang’s housing boom.  Yonhap now provides some additional information on Pyongyang’s current housing ambitions:

The Chosun Sinbo, which usually conveys Pyongyang’s views, described the housing construction as an “unprecedented national project” and a “core project” in the country’s campaign looking to 2012.

The paper reported that the North was in the process of building 65,000 new houses in the city’s western district of Mangyeongdae, where Kim Il-sung’s birth home is located, 15,000 houses in central Pyongyang and 20,000 houses along the railroad spanning between the southern district of Ryokpo and Ryongsong district in the capital’s northern region.

Each home will be approximately 100 square meters in size, according to the report.

The North Korean capital, despite a strict control on the entry of people from rural areas, has reportedly been going through a major housing shortage. The paper said that the completion of the housing project will solve the problem plaguing the citizens of Pyongyang.

In the past, Pyongyang has built 50,000 new apartments each in the 1980s and the 1990s.

In 2001, North Korea sought to develop a satellite city of some 1 million households near the Mangyeongdae district, but failed due to the nation’s economic woes.

You can read additional DPRK real estate posts here.

Read the full Yonhap story here:
N. Korea building new housing districts in Pyongyang: report
Yonhap
Tony Chang
10/12/2009

ORIGINAL POST (2008-9-27): Los Angeles Times reporter Barbara Demick recently visited the DPRK (with the Committee for Cultural Relations with Foreign Countries) and noticed that Pyongyang is experienceing a bit of a construction boom:

Except for the monuments glorifying leader Kim Jong Il and his father, Kim Il Sung, the founder of North Korea, hardly anything new has gone up in decades. By night, the city is so quiet you can hear a baby crying from far across the Taedong River, which cuts through the center of town.

Yet these days, high-rise apartments in shades of pink are taking shape near the Pueblo, the American spy ship captured in 1968 and still anchored in the river. A tangle of construction cranes juts into the skyline near Pothong Gate, a re-creation of the old city wall. About 100,000 units are to be built over the next four years.

A modernistic silver-sided box of a conference center is already complete. Theaters and hotels are being renovated. Streets have been repaved and buildings repainted.

Even North Korea’s most notorious clunker, an unfinished 105-story hotel that looms vacant over the city, is under construction again after sitting idle for nearly two decades.

All are slated for completion by 2012, the 100th anniversary of the birth of Kim Il Sung. The deadline appears to have taken on new urgency for the appearance-conscious North Koreans, who fret that their capital has become a laughingstock.

“We know we need to modernize. We want to make the city comfortable for the people who live here and for tourists,” said Choe Jong Hun, an official with the Committee for Cultural Relations With Foreign Countries.

North Korean officials insist that they’re funding the building spree on their own, in keeping with an underlying ideology that emphasizes self-reliance.

“If we rely on others, our dreams won’t be realized by 2012. It is all built with our own technology, our own material, our own labor, our own strength,” Choe said.

But analysts are skeptical of such claims, given the nation’s economy and the regime’s secretive nature and often deceptive pronouncements.

“This is a puzzle,” said Yoon Deok-ryong, a South Korean economist who recently visited Pyongyang. “The North Koreans are trying to show the outside world that they are not starving, that they are strong, but we know it is not true, so we wonder where the money is coming from.”

Ms. Demick also speculates on a political reason why Kim Jong il might be financing the construction (beyond the stated policy goal of achieving economic success by 2012):

Expatriate businesspeople in Pyongyang say Kim might also be investing some of his own stash with an eye toward maintaining the loyalty of his Workers’ Party cadres. Apartments under construction look to be aimed at the elite.

Read the full story here:
North Korea in the midst of a mysterious building boom
Los Angeles Times
Barbara Demick
9/27/2008

Institute for Far Eastern Studies (IFES)
NK Brief No. 08-9-4-1
9/4/2008

Professional ‘housing trade mediators’ (real estate agents) facilitating less-than official housing transactions have emerged in North Korea, with a wide range of real estate opportunities popping up, including not only sales but even rooms rented out by the month.

An article titled “Chosun’s Real Estate Black Market’ in the monthly magazine, ‘Imjin River (rimjingang)’, detailed the current status of today’s real estate situation, including a description of the black market and issues involved with housing transactions in North Korea. Articles for the magazine are written by reporters inside North Korea gathering first hand information on the state of the North Korean society.

In North Korea, exchanging cash to obtain real estate is a highly illegal activity, but with an extreme shortage of housing and a growing divide between the rich and the poor, the demand for housing sales has grown sharply, leading to the development of the real estate black market.

In the North, when the government allocates houses, it issues a ‘Government Residence Permission Certificate’, allowing the resident to move in. This permit is not, strictly speaking, a certificate of ownership, but rather permission for use of a property, but since there is no expiration date on the permit, once it is issued it is, for all practical purposes, a property deed showing ownership.

Lately, according to the article, almost no one has been receiving residence certificates, and these days, it has become common for North Koreans seeking housing take their money to the black market and either directly or indirectly purchase housing. In addition, as the black market grows, so too, does the linkage of it with the ruling class.

On one hand, as these housing sales in North Korea are illegal, disputes and trouble continue to arise, but on the other hand, because of their illegality, the North Korean government has no official apparatus in place through which to resolve the issues.

According to the Daily NK, the chairpersons of the DPRK’s “People’s Units” (the smallest administrative population unit) are elected by the local membership through a show of hands.  Since the chairperson is in a position of some power, the political and economic dynamics that take place are pretty interesting.  The Daily NK notes how a chairperson’s skill at protecting his constituents from inspections by other departments is now factored into local (unofficial) real estate prices:

Quoting from the article:

“When the inspection group comes, the chairpersons of the People’s Units contact each other in advance, so inspections can be avoided. Nowadays, how a People’s Unit chairperson acts affects the price of housing.”

“People who buy homes now cannot distinguish between good and bad homes, but pay great attention to the People’s Unit in the neighborhood. If the People’s Unit chairperson is not so sophisticated, then the neighborhood cannot come together, so people tend to avoid such neighborhoods and the price of housing tends to fall as well.”

“If an inspection unit comes suddenly, the People’s Unit chairperson tends to alert every household through the children in the village, which has been described as ‘the pastime of the People’s Unit.’ The more a People’s Unit chairperson excels at this, the less damage to the people of the unit.”

“Officials or big-time merchants pay careful attention to their relationship with the chairpersons. No matter what the type of inspection is, the citizens’ attitude can be assumed via the words of the chairperson of the People’s Unit, so the fate of a household depends on the words of the chairperson.”

And if the chairperson is not good at his job?

“Depending on the extent of the damage to the People’s Unit during the inspections, people distinguish whether or not the People’s Unit chairperson is smart and experienced or not. If the chairperson is judged to be not smart, then he or she has to relinquish his or her position.”

It is interesting that the chairpersons take such an interest in protecting their constituents from outside authorities, however, it is naïve to think that local elections are responsible for this behavior.  The reality is that these chairpersons probably know a good deal of information about their residents and collect some form of direct payment, or “taxes”, for their services.  The quote above, “big-time merchants pay careful attention to their relationship with the chairpersons,” is just a more polite way of saying this.  If the chairperson position was not profitable in some way, why would anyone want it?

Read the full Daily NK story here:
Who Is the Chairperson of the People’s Unit?
Daily NK
Moon Sung Hwee
8/18/2008

The most authoritative map of North Korea on Google Earth
Download it here

This map covers North Korea’s agriculture, aviation, cultural locations, markets, manufacturing facilities, railroad, energy infrastructure, politics, sports venues, military establishments, religious facilities, leisure destinations, and national parks. It is continually expanding and undergoing revisions. This is the eleventh version.

Additions include: Mt. Paegun’s Ryonghung Temple and resort homes, Pyongyang’s Chongryu Restaurant, Swiss Development Agency (former UNDP office), Iranian Embassy, White Tiger Art Studio, KITC Store, Kumgangsan Store, Pyongyang Fried Chicken Restaurant, Kilju’s Pulp Factory (Paper), Kim Chaek Steel Mill, Chongjin Munitions Factory, Poogin Coal Mine, Ryongwun-ri cooperative farm, Thonggun Pavilion (Uiju), Chinju Temple (Yongbyon), Kim il Sung Revolutionary Museum (Pyongsong), Hamhung Zoo, Rajin electrified perimeter fence, Pyongsong market (North Korea’s largest), Sakju Recreation Center, Hoeryong Maternity Hospital, Sariwon Suwon reservoir (alleged site of US massacre), Sinpyong Resting Place, 700 Ridges Pavilion, Academy of Science, Hamhung Museum of the Revolutionary Activities of Comrade Kim Il Sung, South Hamgyong House of Culture, Hamhung Royal Villa, Pork Chop Hill, and Pyongyang’s Olympic torch route. Additional thanks go to Martyn Williams for expanding the electricity grid, particularly in Samjiyon, and various others who have contributed time improving this project since its launch.

Disclaimer: I cannot vouch for the authenticity of many locations since I have not seen or been to them, but great efforts have been made to check for authenticity. These efforts include pouring over books, maps, conducting interviews, and keeping up with other peoples’ discoveries. In many cases, I have posted sources, though not for all. This is a thorough compilation of lots of material, but I will leave it up to the reader to make up their own minds as to what they see. I cannot catch everything and I welcome contributions.  Additionally, this file is getting large and may take some time to load.

The Daily NK recenty published some interesting “factoids” on the DPRKs creeping marketization.  Highlights below:

Real estate
“The sale of houses has become a natural occurrence in regions with the exception of farming areas, and even realtors, or “brokers,” have surfaced. Such a reality is rooted in the mass-scale provision of residential homes after the mid-90s, places where the famine victims had lived.”

“In the real estate market in Chongjin or Hamheung, one-story houses with two rooms and a kitchen are being sold for 2,000~3,000 dollars downtown. Recently, a new class called “donjoo” (which means the master of capital or money), which acquired wealth by hanging around the corrupt elite class, has been buying and selling luxury apartments in high-demand areas.”

“This does not mean that a change in the legal system has allowed the private ownership of real estate to be officially acknowledged. People can just change the name on the permit to live in the state houses by giving bribes to government affiliates within the relevant departments.”

Small-scale manufacturing
“In fishing villages, 12 and 14-year old middle-school students are employed for 1,100~1,300 won per day to make nets. This surpasses the 2,000~3,000 won salary for teachers and 10,000 ~ 15,000 won for the most coveted job as a laborer in state-operated coal mines.”

Read the full article here
Real Estate Business Appears in North Korea
Daily NK
Kim So Yeol
8/7/2008

North Korea does not publish economic data.  The size of North Korea’s economy is estimated by South Korea’s Central Bank (Bank of Korea), the US Central Intelligence Agency (CIA), and other think tanks such as the Sejong Institute (Lee Jong Seok). 

According to a recent report by the Bank of Korea, North Korea sufferd its second full year of economic contraction (as defined by GDP), 1.1% in 2006 and 2.3% in 2007.  The bank estimates North Korea’s 2007 gross national income (GNI/GNP) at $26.7 billion, per capita GNP at $1,152 (assuming population of 23 million).  If you are interested in knowing the difference between GNP and GDP, click here.

Here are some highlights from the report:

Agriculture, forestry & fisheries marked a 9.4% decrease following a 2.6% decrease in 2006

Mining increased 0.4% in 2007, down from 1.9% increase in 2006

Manufacturing increased 0.8%, higher than 0.4% 2006 increase. -1.7% growth in light industry, due to the decrease in food products and beverages. +2.3% growth in heavy industries led by expansion of metal and machinery products.

Electricity, gas & water production increased 4.8%, (+2.7% in 2006), from hydroelectric and steam power generation.

Construction production -1.5%, (-11.5% in 2006), from reduced non-housing construction and civil engineering.

Services +1.7%, (+1.1% in 2006). Hotel, restaurant, transport, post & telecom industry expanded.

Trade volume (goods) fell 1.8% to $2.941 billion, 1/248 South Korea’s. Exports fell 3.0%, imports fell 1.3%.

These estimates are based on trade figures obtained from the Korea International Trade Association, Korea Trade and Investment Promotion Agency, fuel and food aid figures from aid groups such as the International Red Cross and the World Food Program, as well as information provided by frequent visitors.

More information here:
Full report by Bank of Korea  and data (recomended)

North Korea’s Economy Shrank in 2007, Second Annual Contraction
Bloomberg
Heejin Koo
6/17/2008