[Yang Nak-gyu's Defence Club] How Much Did North Korea Spend on Missiles Despite Economic Failure?

Kim Jong-un's New Year's Declaration on Military and Economic Development
Economic Progress Faces Challenges from Sanctions and COVID-19

[Image source=Yonhap News]

[Asia Economy Yang Nak-gyu, Military Specialist Reporter] North Korea has demonstrated its determination to simultaneously strengthen its national defense capabilities and pursue a self-reliant economy this year, but evaluations suggest it has effectively failed in achieving a self-reliant economy.

North Korean media extensively reported on the results of the 8th Central Committee 4th Plenary Meeting of the Workers' Party of Korea, led by Kim Jong-un, instead of the usual 'Kim Jong-un New Year's Address' on January 1 this year. The core of the plenary meeting was the development of the economy and defense capabilities.

General Secretary Kim Jong-un declared this year the 'Kim Jong-un-style New Village Movement.' It accounted for 42% of the report, indicating its importance. It evoked memories of the Park Chung-hee-style New Village Movement, which promoted the slogan 'Let's live well.' However, six months have passed, and the results have been disastrous.

In 2016, when North Korea conducted a nuclear test, China joined the UN sanctions against North Korea, cooling North Korea-China relations. North Korea is making efforts to recover its economy this year, but the COVID-19 pandemic has made the situation challenging.

Each ICBM launch costs 37.9 billion KRW; mid-range missile launch costs 18.9 billion KRW
Over 1 trillion KRW spent on missile development in the first five years of Kim Jong-un's rule
Similar provocation patterns as during Park Geun-hye administration suggest increased focus on missile development ahead

Meanwhile, North Korea has continued its 17th provocation this year. Compared to six times in 2020 and eight times in 2021, this is unusual. The cost of missile launches by North Korea is not trivial.

According to Bruce Bennett, a senior researcher at the RAND Corporation and a U.S. military security expert, who spoke to Voice of America (VOA) on February 9, North Korea spends between 20 million USD (about 25.3 billion KRW) and 30 million USD (about 37.9 billion KRW) to launch an ICBM. Launching a short-range missile costs between 3 million USD (about 3.7 billion KRW) and 5 million USD (about 6.3 billion KRW), while launching a mid-range missile like the Hwasong-12 costs between 10 million USD (about 12.6 billion KRW) and 15 million USD (about 18.9 billion KRW).

North Korea's pattern of provocations this year resembles that of the beginning of the Park Geun-hye administration in 2013. In early 2012, North Korea broke the '2·29 Agreement' with the U.S., and on December 12 of the same year, it launched the ICBM-class long-range ballistic missile 'Unha-3' under the pretext of a 'satellite launch.' Additionally, in February 2013, shortly after the Park Geun-hye administration took office, North Korea conducted its third nuclear test.

According to the 'White Paper on Kim Jong-un's Five Years of Misrule' released by the National Intelligence Service at the end of 2016, North Korea spent a total of 1.0268 trillion KRW on missile development immediately after the failure of the 'Unha-3' launch in 2012. Of this, about 362.4 billion KRW was spent purely on missile development, including approximately 483.2 billion KRW for the construction of the Dongchang-ri launch site and 181.2 billion KRW for satellite development. The unit price per Scud and Nodong missile is estimated at 1 to 2 billion KRW, Musudan missiles at 3 to 6 billion KRW, and SLBMs at 5 to 10 billion KRW.

The cost of developing nuclear weapons is also considerable. It is estimated that North Korea invested between 600 million and 700 million USD in nuclear facility construction, 200 million to 400 million USD in highly enriched uranium development, 160 million to 230 million USD in nuclear weapon manufacturing experiments, and 100 million to 200 million USD in basic nuclear fusion research, totaling approximately 1.1 to 1.5 billion USD in nuclear weapons development.

There are criticisms that these figures are unrealistic. Since North Korea is a socialist system without the concept of private property rights, labor costs and land expenses are much lower than in other countries. Dr. Yuri Karash of the Russian Academy of Space Science, who observed the Unha-3 launch in 2012, estimated that "(the cost of missile and satellite production) was roughly 50 to 60 million USD (about 60.4 to 72.4 billion KRW)." In 2013, Japan's Mainichi Shimbun reported that the Workers' Party of Korea stated in an internal lecture that "(a missile launch) requires 30 million USD (about 36.2 billion KRW)."

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