Northern Budget: 48% for Economy, 16% for Defense "Removing Sanctions Blockade through Self-Reliance"

Report on the 2020 Budget of the Supreme People's Assembly
"A Direct Offensive to Open New Avenues"
'Economic Driving Force' Science and Technology Growth Rate Highest

On the 12th, North Korea held the 3rd session of the 14th Supreme People's Assembly at the Mansudae Assembly Hall in Pyongyang. Amid the COVID-19 pandemic, 687 delegates elected from across the country attended this meeting.

North Korea, embarking on a path of 'self-reliance' and a 'direct breakthrough,' has decided to allocate nearly half of its budget to the economy this year and continue its all-out economic construction campaign. The defense budget has also been slightly increased compared to last year, maintaining the policy of 'strengthening self-defensive national defense capabilities.'

According to the North Korean state media Korean Central News Agency on the 13th, North Korea reported a budget plan at the 3rd session of the 14th Supreme People's Assembly held the previous day at the Mansudae Assembly Hall in Pyongyang, showing a 4.2% increase in national budget revenue and a 6% increase in expenditures compared to last year.

Amid the dual hardships of international sanctions against North Korea and the COVID-19 pandemic, 47.8% of the total budget expenditure this year will be invested in economic construction. North Korea also allocated 47.8% of its total expenditure to economic construction last year.

The Supreme People's Assembly Budget Committee stated regarding national budget expenditures, "By increasing the funds necessary for economic construction to 106.2% compared to last year, allocating funds equivalent to 47.8% of total expenditures, we have been able to actively promote a vigorous march of self-reliance to bring about substantial productive uplift and improve the people's living standards."

Expenditures for the 'people's economy' this year, including metals, chemicals, electricity, coal, machinery, building materials industries, railway transportation, light industry, agriculture, and fisheries, have also been increased by 7.2% compared to last year.

In particular, due to the severe infectious disease crises such as COVID-19 and African Swine Fever (ASF), investment in the health sector has been increased by 7.4% compared to last year. This is 1.6 percentage points higher than the previous year's (2018) increase rate of 5.8% in health sector investment.

This appears to reflect the budget for the construction of the Pyongyang General Hospital, which Supreme Leader Kim Jong Un ordered to be completed by the 75th anniversary of the founding of the Party (October 10).

The Budget Committee stated, "Funds necessary to promote the construction of important projects to be completed this year, such as the Pyongyang General Hospital and the installation of oxygen separators at the Kim Chaek Iron and Steel Complex, will be secured as planned," explicitly indicating that the construction of the Pyongyang General Hospital is one of the top priorities.

The 3rd session of the 14th Supreme People's Assembly of North Korea was held at the Mansudae Assembly Hall on the 12th, according to a report by the Korean Central News Agency on the 13th.

The sector with the highest increase rate in this year's budget expenditure compared to last year is science and technology, described as the "locomotive driving economic development," which increased by 9.5%.

The proportion of the defense budget in total expenditures is 15.9%, slightly up from 15.8% last year. The Budget Committee explained, "By allocating 15.9% of the total national budget expenditure to defense to comprehensively strengthen self-defensive national defense capabilities, we have been able to firmly guarantee the country's sovereignty, the people's safety, and today's direct breakthrough."

Education expenses have increased by 5.1% compared to last year. On the same day, the Supreme People's Assembly also adopted the 'Distance Education Law,' which appears to be a continuation of measures emphasizing science education for talent development.

Support for education for overseas nationals will also continue. The news agency stated, "This year as well, a large amount of educational aid and scholarships will be sent for the children of Korean residents in Japan to continue promoting the democratic national education development of the General Association of Korean Residents in Japan (Chongryon)."

Among social and cultural project expenses, the literature and arts sector was increased by 5.8%, and the sports sector by 4.3%.

National budget revenue is expected to increase by 4.2% compared to last year, with the growth rates of transaction income and state enterprise profits, which are similar to value-added tax and corporate tax in the South, estimated at 1.1% and 1.2%, respectively.

The news agency emphasized, "Accurately executing this year's national budget is a responsible and important task facing our workers in the direct breakthrough to eradicate the root of the hostile forces' relentless sanctions and blockade that try to block our progress and to open a new path for socialist construction under the banner of self-reliance."

The 3rd session of the 14th Supreme People's Assembly of North Korea was held at the Mansudae Assembly Hall on the 12th, according to a report by the Korean Central News Agency on the 13th.

This content was produced with the assistance of AI translation services.