Sept. 30 (UPI) — Prices and exchange rates have stabilized in North Korea since Kim Jong Un fully assumed power in 2012, a South Korean think tank said in a report released Monday.
The stabilization of key macroeconomic indicators does not mean the economy has been making progress, despite claims from the regime. North Korea registered negative GDP growth in 2017 and 2018, South Korean newspaper JoongAng Ilbo reported.
The North Korea economic review from South Korea government-run Korea Development Institute published Monday credited the stabilization of prices in the Kim Jong Un era to changes in policy, including less state intervention in North Korean agriculture.
“After the North Korean authorities’ currency reform failed several times, and prices surged, they gave up state control, which stabilized the exchange rate and prices,” the South Korean report stated. “The acceptance of the Jangmadang [informal markets] as an institutional power gave boost to the North Korean economy, allowing the macro economy to function smoothly.”
KDI’s report said informal markets accounted for anywhere from 30 to 80 percent of the North Korean economy. The report covers macroeconomic trends in the regime from 2012 to 2018.
North Korea may have resolved the issue of runaway inflation that defined former leader Kim Jong Il’s final years of rule, but the economy is still struggling, according to KDI.
The think tank said while North Korea’s economy grew 3.9 percent in 2016, it contracted by 3.5 percent and 4.1 percent in 2017 and 2018, respectively.
North Korea’s economic struggles were not mentioned on Monday at the United Nations General Assembly, where a Pyongyang diplomat said his people are making efforts to “fully realize an independent and powerful country.”
North Korea’s economy could be in limbo at a time when more of the regime’s workers are taking greater risks.
Russia’s Tass news agency reported Monday Russian authorities have arrested 10 North Korean fishermen who were engaged in activities in Russia-claimed waters.
The group includes a North Korean crew of six fishermen who were injured during clashes with Russian border guards at sea.