North Korea’s economy expanded for a third straight year in 2025, growing 3.5%, according to South Korea’s central bank estimates. Growth was driven by arms exports to Russia, stronger trade deficit with China, and Kim Jong Un’s push to develop regional industries.

Export demand for weapons lifted manufacturing output, while a surge in Russian tourists and improved transport links boosted lodging, food service and travel. Income from North Korean labourers abroad and troops supporting Russia’s war effort also sharply boosted foreign‑currency earnings.

Manufacturing rose 6.6%, with light industry turning from a 0.7% contraction in 2024 to a 3.8% growth, linked to the policy dubbed 20x10 that aims to build 20 light‑industry factories each year for a decade. Construction grew 6.3%, and services grew 1.8%, the fastest pace since 1994.

The North’s trade volume, excluding South Korea, rose 16% to $3.13 billion, with exports climbing 30% to $470 million and imports up 13.9% to $2.66 billion. Total nominal gross national income was estimated at 48.5 trillion won ($34 billion), about 1.8% of the South’s.