A View through the Trade Window: North Korean Exports as an Indicator of Economic Capabilities

This study uses detailed information on Democratic People's Republic of Korea exports to assess the state of its indigenous industrial (civilian-use) capability. The view through the trade window is sobering. We find that most North Korean exports reflect the capabilities of foreign investors and do not reflect the factor abundance of North Korea other than its mineral endowments. While some capability emerged in aquaculture and export processing, there is little evidence of indigenous manufacturing activity that meets international standards. Moreover, most trade is facilitated either at the border or through foreign companies or special cooperative programmes. This lack of domestic trading experience indicates a low capability for finding and serving foreign markets.