North Korean economy shrinks for 2nd year in 2021 on sanctions, pandemic: BOK

A sign is seen on a street closed to traffic, amid growing fears over the spread of the coronavirus disease (COVID-19), in Pyongyang, May 18. Reuters-Yonhap

North Korea's economy is estimated to have contracted for the second straight year in 2021 on global sanctions and the coronavirus pandemic, South Korea's central bank said Wednesday.

The North's economy, which has been hit by tightened U.N. sanctions over its nuclear and missile programs, shrank 0.1 percent last year from the prior year, the Bank of Korea (BOK) said in a report.

Still, last year's contraction slowed from a negative growth rate of 4.5 percent recorded a year earlier.

On top of the U.N. sanctions, the reclusive country also took a hit from the closure of its border with China, Pyongyang's biggest economic ally, according to the central bank.

The BOK's annual report is based on data from South Korean institutions specializing in North Korea, which does not publish official economic data.

North Korea's foreign trade sank 17.3 percent on-year to $710 million in 2021 as shipments to and from China, the North's biggest trading partner, were hit hard by the pandemic.

The North's exports totaled $80 million in 2021, down 8.2 percent from a year ago, and imports plunged 18.4 percent to $630 million.

Trade between South and North Korea amounted to a mere $11 million last year due to the fallout from the closure of the inter-Korean industrial park in the North Korean border town of Kaesong in 2016.

North Korea's nominal gross national income (GNI) came to 36.3 trillion won ($327.7 billion) in 2021, which was equivalent to just 1.7 percent of South Korea's GNI.

The North's GNI per capita in 2021 stood at 1.42 million won, equivalent to 3.5 percent of that for South Korea. (Yonhap)

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