In 2023, North Korea intensified its political and economic development. Pyongyang is returning to its historical roots and investing economic resources in heavy industry, where it has a comparative advantage. Although Supreme Leader Kim Jong-un only pays lip service to the idea of raising living standards, the overwhelming narrative is one of continued regression. This is to the detriment of the common people.
North Korea's return to its historical roots was evident in the published records of the ninth plenary session of the Eighth Central Committee of the Workers' Party of Korea, held in the capital in late 2023. Also accelerated by this, North Korea is increasingly seeking to expand control and supervision over its economy. This represents a reversal of the strategy pursued since the early 2000s, in which markets and market mechanisms increasingly dominated the economy.
Daily NK reported in late 2023 that the government had launched a re-registration campaign for companies and government agencies. Police have been tasked with auditing the books of companies and government agencies to ensure they are adhering to government guidelines. This fits well with the goal of “accelerating future progress in all aspects of socialist construction and strengthening national power,” as stated at the ninth plenary session.
The specific impact of this campaign on government control of the economy is not yet known. However, it is safe to say that ordinary people will suffer most as the state's program of increased state control moves forward, suppressing the private economic activity that has made North Korean society more resilient.
Significantly, the most significant achievement for the economy in 2023 was a relatively good harvest. Given North Korea's ongoing food problems, this is no small achievement, but it is not significant economic progress. The report of the Ninth Plenary Session states: “The overachievement of the grain production target… [was] “The most valuable and valuable achievement achieved in economic work for 2023”.
Although irrigation efforts may well have made a difference, this success is primarily due to improved weather conditions. As the U.S. Department of Agriculture noted in 2022, improved weather conditions “continued to increase yield expectations from average to above average, particularly for key summer-grown food security crops, corn and rice.”
While better agricultural production is good news, the fact that it is being touted as the economy's greatest achievement points to something important about the overall state of the economy. In 2023 and into 2024, North Korea has returned to a more Stalinist, conservative and traditional view of economic progress.
The way North Korea touts the production of goods such as steel, iron and coal as a measure of success clearly has Soviet overtones. The mere production of these goods has little value in itself unless the goods contribute to broader economic development. But in the Stalinist economic approach to which the North Korean regime appears to have returned, production alone is an achievement that demonstrates national strength – regardless of what is later done with the goods.
The North Korean leadership will likely hope for much greater success. In 2023, the warming of relations with Russia continued. North Korea has likely already exported millions of shells and missiles to Russia to help it in its war with Ukraine. North Korean Foreign Minister Choe Son-hui visited Russia on January 15-17, 2023 and returned with the message that Russian President Vladimir Putin may soon visit Pyongyang. It is no coincidence that Kim Jong-un visited several weapons factories in 2023.
North Korea appears to be returning to its old Soviet-era position – trading with Russia and China but few others, while devoting its resources primarily to heavy industry. Focusing on these industries could one day help the country grow, as has happened in South Korea, but for now they are still too inefficient and uncompetitive globally.
North Korea's continued economic turnaround presents a bleak prospect for ordinary North Koreans, but for North Korea as a state, this is a known reality and a viable strategy as long as global tensions continue to rise.
Benjamin Katzeff Silberstein is a research fellow at the Swedish Institute of Foreign Affairs and a lecturer at the Hebrew University of Jerusalem.
This article is part of an EAF special series of articles looking back on 2023 and the year ahead.
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