South Korea's central bank: North Korean GDP down in 2009

Jun 24, 2010, 12:09 GMT

Seoul - North Korea's economy shrank in 2009 after showing growth the previous year, the central bank of neighbouring South Korea said Thursday.

The gross domestic product of the communist state fell 0.9 per cent on poor harvests and the impact of heightened trade sanctions, against a 3.1-per-cent growth in 2008, the Seoul-based Bank of Korea said.

A drop in agricultural production was largely due to 'particularly severe cold weather,' and the sag in industrial production was caused by a 'lack of raw materials and electricity,' the bank's report said.

The United Nations Security Council tightened sanctions in response to the underground test explosion of a nuclear device on May 25 last year.

Although most sectors contracted, a few showed modest growth. Coal mining, hydroelectric power production and the construction industry were slightly up on the previous year. Electricity, gas and water production remained level.

Overall gross national income was valued at 28.6 trillion South Korean won (24 billion dollars), around 2.7 per cent of that of its southern neighbour.

The estimations are considered approximate, as North Korea publishes almost nothing on its economic performance.

The Bank bases its calculations on intelligence sources and research institutes specialized in North Korea. It publishes the estimated performance indicators alongside its assessment of the South Korean economy.