The share of defence expenditure in total expenditure has increased considerably since the 1960s: from 3.7% in 1959 to 19% in 1960 and from an average of 19.8% between 1961 and 1966 to 30.4% in 1967. After remaining around 30% until 1971, the defensive share fell sharply to 17% in 1972 and continued to decline in the 1980s. Officially, the share of defence remained at 12% in 1989 and 1990, and for 1991 it was 12.3%, with 11.6% forecast for 1992. The downward trend was in line with the government`s stated intentions to stimulate economic development and increase social benefits. Western experts, however, have estimated that actual military spending is higher than budget figures suggest. [18] And it is not only in their home countries that North Korean workers are underpaid and mistreated for the benefit of the wealthy elite. There have been rumors for years that North Korea benefits from forced labor, and in 2015, at a United Nations press conference by rapporteur Marzuki Darusman, it was claimed how bad the situation was. Between 50,000 and 100,000 North Korean citizens have been sent overseas – mainly to China and Russia, but also to countries in Asia, Europe and Africa – to work in various labor industries, including mining, construction and textiles. Working conditions are harsh and wages are virtually non-existent, with constant monitoring to ensure workers are being worked to the bone. The money is exchanged for tortuous work, but it goes directly to the North Korean government.

As Kim Kuk-song says, “All the money in North Korea belongs to the leader.” The third seven-year plan paid great attention to the development of foreign trade and joint ventures, the first time a plan addressed these issues. However, until the end of 1991, two years before the end of the plan, no quantitative targets were published, indicating that the plan had not produced good results. [Original research?] The diversion of resources for the construction of highways, theatres, hotels, airports and other facilities for the Thirteenth World Festival of Youth and Students in July 1989 must have had a negative impact on industrial and agricultural development, although the expansion and improvement of social infrastructure has led to some long-term economic benefits. [18] The fundamental objective of the Second Seven-Year Plan (1978-1984) was to achieve the three objectives of autonomy, modernization and “scientificization”. Although the emphasis on autonomy is not new, it had not been the explicit subject of an economic plan before. This new direction may have been a response to the growing external debt from large imports of Western machinery and equipment in the mid-1970s. By modernizing, North Korea hoped to increase mechanization and automation in all sectors of the economy. “Scientificization” refers to the application of current production and management techniques. The specific objectives of the economic plan were to strengthen the fuel, energy and resource base of industry through the priority development of the energy and raw materials industry; industry modernization; replace certain imported raw materials with domestic resources; strengthen freight transport capacity in rail, road and marine transport systems; centralize and containerize the transportation system; and accelerate a technical revolution in agriculture. [18] 1.

It would be interesting to compare the reactions of North Korea and Vietnam to the joint shock of the withdrawal of Soviet aid and the collapse of the USSR. I assume that the Vietnamese have been able to reform their more agricultural economy much more effectively and boost exports to reduce balance of payments restrictions, while the North Koreans have been forced to reduce the level of domestic activity in the absence of a stronger export orientation. Unfortunately, the extreme uncertainty surrounding North Korea`s balance of payments position (mainly due to the issue of undeclared trade remittances discussed later in this paper) effectively prevents a quantitative survey in this direction. However, Eberstadt (1997) calculates that between 1989 and 1995, the Vietnamese almost tripled their exports (mainly due to the liberalization of the price of rice, their main exportable rice, which led to an increase in production), while North Korean exports fell by half. .