North Korea's dismal economy has shrunk for the second year running. To hide this, the regime has not released any official economic data, but the U.S. estimates the North's grain yield by comparing satellite images.Various public projects in preparation for regime founder Kim Il-sung's centenary in 2012 are on the skids, and the North is flogging underground resources to China at rock-bottom prices to pay for them. The rationing system, the backbone of socialist planned economy, has nearly collapsed, and North Koreans are suffering from shortages of food and goods. Of a population of 24 million, 4 million people in Pyongyang and surrounds are living off rations from the central government, but the rest are essentially dependent on private markets.
According to the Bank of Korea, the North posted a GDP growth of 3.1 percent in 2008. But GDP shrank 0.9 percent in 2009 and 0.5 percent in 2010. Last year, the North's gross national income amounted to about W30 trillion, a mere 1/39 of South Korea's W1,173.1 trillion. Its per capita GNI was W1.24 million, only 1/19 of South Korea's W24 million (US$1=W1,173).