North Korea runs one of the most bizarre economies on the planet. Despite being one of only a handful of countries with nuclear weapons, its 2024 gross domestic product (GDP) was a modest $26.6 billion (€22.9 billion).
That’s about 70 times smaller than South Korea’s $1.86 trillion economy and about a fifth of the annual revenue of NVIDIA, the world’s top-traded company.
Thanks to a centrally planned economy that prioritizes domestic production, North Korea is nowhere near as dependent on trade as your average free-market economy, partly due to United Nations sanctions that were imposed in 2017 over its nuclear weapons and ballistic missile program.
According to the World Bank, the North’s total imports and exports account for only a small share of GDP, compared to the South, where international trade makes up about 80% of the economy.
How important is China to North Korea’s economy?
You could say that China plays an almost special role in North Korea’s minimal dependence on trade.
According to a Washington-based think tank National Committee on North KoreaPyongyang depends on China for 95% of its total trade and 85% of its exports.
Almost all imports also come from China. In 2024, North Korea’s legitimate imports were only $2.33 billion – very low by global standards.
With no domestic oil production, these deliveries from China include petroleum and other fuels and are essential to keep the economy running, along with food, textiles, machinery, electronics and vehicles.
This gives Beijing enormous economic influence over North Korean leader Kim Jong Un. A recent report suggests that US President Donald Trump is now trying to leverage that power to bring Pyongyang back to the negotiating table over its controversial nuclear weapons programme.
South Korea’s Yonhap news agency recently reported that Chinese President Xi Jinping is expected to visit Pyongyang in the next few weeks, playing a key mediator role to help bridge the gap between Trump and Kim in the long-running dispute. Beijing has not yet confirmed the visit.
What is North Korea allowed to export to the rest of the world?
The rogue state’s legitimate exports are even less impressive. According to the Korea Trade-Investment Promotion Agency (KOTRA), North Korea’s exports could barely reach $360 million in 2024.
Foreign sales are extremely modest, with fake hair and wigs being the country’s single best sellers, accounting for about 40% of exports, primarily to China, which then exports them to the rest of the world.
North Korea turned to wigs for significant foreign income as sanctions blocked its traditional major exports such as coal and minerals, while fake hair was not explicitly banned.
The communist country had an abundant supply of low-cost and often forced labor – perfect for a highly labor-intensive and low-tech business like wigmaking.
Other goods such as tungsten and other ores, frozen fish, iron and steel and watch components each make up less than 10% of the country’s exports.
According to the Korea Economic Institute of America think tank, Pyongyang has lost about $2.2 billion annually in export revenues since the sanctions were imposed.
How else does Pyongyang make money?
In addition to its major exports, North Korea generates considerable hard currency through its shadow economy.
The country sends thousands of workers overseas to work in construction, logging, factories and fishing, many of them to Russia and China.
The program is widely viewed by human rights groups and the United Nations as another form of forced labour.
The state seizes most of their wages, amounting to about half a billion dollars annually, according to a UN panel of experts.
Thousands of North Korean computer professionals also work for US, South Korean and EU-based companies, pretending to be legitimate freelancers, using false – often stolen – identities.
Often, they earn high salaries, which are then fed back into governance. According to the US Treasury Department, in 2024, the state received $800 million from these loyalty remittances.
North Korea also operates one of the world’s most sophisticated and lucrative hacking programs, prompting a American think tankDubbing its cyber criminals as “the most dangerous state-sponsored threat to the financial services sector”.
Blockchain intelligence firm Chainalysis has calculated that last year, North Korean hackers stole a record $2.02 billion in cryptocurrencies, representing more than half of all global digital currency thefts that year.
Still, the communist nation’s biggest — and most obscure — money spinner has been fueled by the war in Ukraine and Pyongyang’s long-close ties with Moscow.
North Korea has supplied Russia with millions of artillery shells, rockets and ballistic missiles, boosting the Kremlin’s war machine and earning Kim’s regime an estimated $7 billion to $13.8 billion through 2023, according to South Korea’s Institute for National Security Strategy.
According to Seoul-based intelligence officials, this revenue is being used to accelerate the North’s nuclear and ballistic missile programs, as well as to obtain additional oil and food from China.
Edited by: Rob Mudge