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North Korea’s Choice

NEW YORK – When the Republic of Korea was established in 1948, Korea was one of the poorest countries in the world. GDP per capita was US$67 in 1953, immediately following the Korean War, and rose to only US$79 in 1960. At that time, North Korea’s economy was much stronger than that of the South. Natural resources were abundant in the North, and even electricity was supplied from North to South. Most industry was located in the North, whereas the South was mainly agricultural.

Today, the South’s GDP is 40 times larger than that of the North. Comparing the two Korean economies is virtually meaningless.

Such disparities do not arise from different historical experiences, because Koreans have shared a history for thousands of years as one nation. The gap, instead, reflects recent historical choices.

By persistently adhering to a planned economy and obsolete ideology, North Korea is trapped in a vicious cycle, suffering from unstable food supplies and low, or sometimes negative, economic growth. Nonetheless, North Korea has shown little interest in reform. Instead, it has developed a nuclear weapons program that threatens stability in the region and places a heavy burden on its economy.