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ECONOMIC
SYSTEM
Socialistic
System of Ownership
In
North Korea, the socialistic system of ownership
is defined as "collective or common ownership
of production means and products that are basic to
socialistic production." The production means
under the socialistic economic system are owned by
the state and communal groups.
Those
playing a leading role in the nation's economic
development such as the nation's all natural
resources, railroads, aviation, transportation,
postal and communicational institutions, major
factories, businesses, ports and banks are owned
by the state.
Communal
groups can own land, farming machinery, ships,
small and medium-sized factories and businesses.
The communal groups are comprised of social groups
and community groups. Major social groups are the
Workers'Party, the Vocational Federation, the
Women's Federation and Kim Il-sung Socialist Youth
Federation. Representative forms of communal
groups are communal farms.
The
country permits very limited forms of personal
ownership, i.e. of personal saving, home
appliances and everyday articles of consumption.
However, no personal ownership is allowed of
production means. Individuals are free to dispose
of their personal belongings and their right of
inheritance is also allowed.
Centrally
Planned Economy
Economy
in North Korea is a system in which all economic
activities are carried out in accordance with the
state-sponsored plans. Drawing and supervision of
economic plans are carried out under a unitary
system centered around the State Plan Committee
from Provincial level down to small businesses.
Each
committee of all ministries also has its own
planning department, whose planned figures are all
uniformly submitted to the State Plan Committee
for its control and coordination.
INDUSTRIAL
STRUCTURE
Characteristics
of Industrial Structure
-
In
North Korea, agriculture and fishery account
for 30% of the entire industry, with another
30% accounted by the service industry. This
shows that its structure still follows those
of typical developing nations. The higher
share of the service industry is due to the
government sector's higher share in its
economic system of centralized planning.
-
The
nation's light industry has been regarded as less important than the
heavy industry including the munitions industry, which fact has caused
the ever deepening unbalance among industries.
-
North
Korea has abundant natural resources. Its mining industry has been
well developed, centered around strategic ores including coals. In
199, for example, the mining industry accounted for 7.3% of the GNP
(compared to 0.4% in the case of South Korea).
Industrial
Structure
(Unit:
%)
|
¡¡
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North
Korea
|
South
Korea
|
|
1997
|
1998
|
1999
|
1998
|
1999
|
|
Agriculture,
Forestry and Fishery
|
28.9
|
29.6
|
31.4
|
4.9
|
5.0
|
|
Mining
and Manufacturing Industry
|
25.5
|
25.6
|
25.6
|
31.2
|
32.2
|
|
(Mining)
|
(6.7)
|
(6.6)
|
(7.3)
|
0.4
|
0.4
|
|
(Manufacturing)
|
(18.8)
|
(19.0)
|
(18.3)
|
(30.9)
|
(31.8)
|
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(Light
Industry)
|
(6.5)
|
(6.4)
|
(6.1)
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(7.1)
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(6.9)
|
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(Heavy
Industry)
|
(12.3)
|
(12.6)
|
(12.2)
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(23.9)
|
(24.9)
|
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Utility
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4.3
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4.2
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4.5
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2.4
|
2.6
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Construction
|
6.3
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5.1
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6.1
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10.1
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8.8
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Service
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35.0
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35.6
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32.4
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51.2
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51.4
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(Government)
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(25.1)
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(25.3)
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(22.8)
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(10.5)
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(9.8)
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(Others)
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(9.9)
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(10.3)
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(9.6)
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(40.7)
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(41.6)
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GDP
|
100.0
|
100.0
|
100.0
|
100.0
|
100.0
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Source:
The Bank of Korea (South Korea)
Nominal GDP =100
Trend
for Changes in North Korea's Industrial Structure
(Unit:
%)
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¡¡
|
1960
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1970
|
1987
|
1990
|
1996
|
1997
|
1998
|
1999
|
|
Agriculture,
Forestry and Marine Products
|
28.9
|
21.5
|
20.0
|
26.8
|
29.0
|
28.9
|
29.6
|
31.4
|
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Mining
and Manufacturing
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41.3
|
57.3
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60.0
|
42.8
|
28.0
|
25.5
|
25.6
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25.6
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SOC
and Service
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29.8
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21.2
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20.0
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30.4
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43.0
|
45.6
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44.9
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43.0
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Source:
The Korea Development Bank and the Bank of Korea (South Korea)
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General Section
