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Mon, Jun 29, 2009 - Page 10 News List

Economy in North Korea grew 3.7 percent last year

AP , SEOUL

North Korea’s economy grew last year after good weather boosted agricultural production, South Korea’s central bank said yesterday.

The North’s GDP for last year was estimated at US$24.7 billion, a 3.7 percent increase from 2007, Seoul’s Bank of Korea said in a news release. The impoverished North’s economy shrank 2.3 percent in 2007 and 1.1 percent in 2006.

The central bank said the North’s economic growth was mainly because of “temporary factors” such as favorable weather conditions that resulted in an increase in agricultural production, and the arrival of oil shipments under an international disarmament deal on its nuclear program.

The size of North Korea’s economy, however, was still about 2.6 percent of South Korea’s, the bank said, adding it was “difficult” to determine whether last year’s growth means the country’s internal economic conditions have improved.

The bank said the North’s agricultural production increased 10.9 percent last year compared with 2007. The production of coal, iron ore and other minerals expanded 2.3 percent and the manufacturing industry 2.5 percent.

The South’s central bank regularly releases its estimates of the North Korean economy after collecting data from the National Intelligence Service and other related government agencies. The reclusive Pyongyang regime provides no details to the outside world of its own economy.

North Korea has faced a chronic food shortage since natural disasters and mismanagement devastated its economy in the mid-1990s.

Famine is believed to have killed about 2 million people, and the country’s food situation was worsened by devastating floods in 2007 that destroyed more than 11 percent of crops.

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