Economy of North Korea

Economy Of North Korea

North Korea's economy is a centrally planned system. The role of market allocation is sharply limited – mainly in the rural sector where some peasants sell produce from small private plots. Although there have been scattered and limited attempts at decentralization, as of mid-1993, Pyongyang's basic adherence to a rigid centrally planned economy continues, as does its reliance on fundamentally non-pecuniary incentives. There have been reports of economic liberalisation, particularly after Kim Jong-un assumed the leadership in 2012, but recent reports conflict over what is happening. The collapse of communist governments around the world in 1991, particularly North Korea's principal source of support, the Soviet Union, forced the North Korean economy to realign its foreign economic relations. Economic exchanges with South Korea have begun: see Kaesong Industrial Region. With GDP per capita of less than $2,000, North Korea remains as one of the world's poorest and least developed countries, in sharp contrast to its neighbor South Korea, which has one of the largest economies in Asia.