ECONOMICS

North Korea has a centrally controlled economy that is plagued by chronic economic problems, including a nearly beyond repair industrial capital stock, corruption, resource misallocation, and poor maintenance. This, along with large-scale military spending and the development of ballistic missiles and nuclear programs, has severely limited investment and consumption. The country's industrial and power outputs have stagnated at a fraction of pre-1990 levels, and food shortages due to weather-related crop failures, lack of arable land, and other systemic problems have been a persistent issue. The government has allowed semi-private markets to operate and made changes to communal farming, but these efforts have not fully alleviated the economic hardships faced by the population. UN sanctions and South Korea's cessation of aid, trade, and cooperation have further exacerbated the situation, and the government's primary focus on maintaining firm political control is likely to inhibit significant economic reform.