[Global NK Commentary] What Economic Benefits Has North Korea Gained from the Russia-Ukraine War?

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I. Background

According to a report submitted by the National Intelligence Service to the National Assembly Intelligence Committee in 2025, the number of casualties among North Korean personnel deployed to the Russia-Ukraine war was estimated to exceed 4,700 (<Yonhap News> 2025). The Defense Intelligence Agency of the Ministry of National Defense analyzed that approximately 20,000 containers were shipped from North Korea via Rajin Port, which could amount to up to 9.4 million shells if filled with 152mm artillery shells (<Yonhap News> 2024). Given this large-scale human and material military support, what compensation has North Korea actually received?

Experts have predicted that North Korea's economy, which has been stagnant due to strengthened UN sanctions since 2017 and border closures due to COVID-19 in 2020, could find a breakthrough through cooperation with Russia. In particular, with the strengthening of strategic solidarity between North Korea and Russia following the Ukraine war, it was predicted that Russia would likely provide substantial support to North Korea in areas such as energy and food.

However, looking at the North Korean economy since the full-scale military support began in late 2023, it is difficult to say that the so-called 'war boom' has materialized. This article evaluates the impact of strengthened cooperation with Russia on the North Korean economy, focusing on macroeconomic indicators such as market prices, and examines the structural factors that make its effects inevitably limited. It also discusses the possibility of expanding North Korea-Russia cooperation in the future and its policy implications for the international community.

II. Impact of North Korea-Russia Economic Cooperation

The most notable area of North Korea-Russia economic cooperation is the dispatch of workers. Russia urgently needs external labor due to personnel shortages caused by the war and for the reconstruction of occupied territories, and North Korean workers are preferred due to low wages and high controllability. In its 2025 report to the National Assembly, the National Intelligence Service estimated that approximately 15,000 North Korean workers were sent to Russia. This is considered a factor that could provide some relief to North Korea, which is suffering from a shortage of foreign currency. However, this foreign currency income faces the structural constraint of the declining value of the Russian ruble. As the ruble has continuously depreciated since the Ukraine war, the actual value of foreign currency earned by North Korea may also decrease. Therefore, a quantitative increase in dispatched workers may not necessarily lead to an increase in foreign currency income.

Meanwhile, in terms of commodity trade, it is difficult to accurately assess the trade volume as Russia has not disclosed official trade statistics since the Ukraine war. However, in 2023, Russian Presidential Aide Yury Ushakov stated that the trade volume between North Korea and Russia was approximately $34.4 million, a ninefold increase compared to the previous year ("RFA 2024). Trade may have increased further in 2024 due to strengthened military cooperation. However, regardless of the speed of increase in trade volume, the absolute level remains low. Since 2010, Russia's share in North Korea's trade has consistently remained around 1%, and even the recent figures are less than half of the $76.9 million in 2016, before the UN sanctions were strengthened.

The actual effect of Russian goods entering North Korea can be indirectly judged by market price trends. Russia is a major exporter of grain and refined oil, and if there had been a large-scale supply, the prices of gasoline and corn in North Korea would likely have stabilized.

<Figure 1> Trend of Gasoline Prices in North Korean Markets (Jan 2017 - Mar 2025, Unit: North Korean Won)

Source: DailyNK, Asia Press

<Figure 2> Trend of Corn Prices in North Korean Markets (Jan 2017 - Mar 2025, Unit: North Korean Won)

Source: DailyNK, Asia Press

<Figure 1> and <Figure 2> show the trends in gasoline and corn prices in North Korean markets based on data collected by the North Korea-focused online media "DailyNK" and "Asia Press". As can be seen from the figures, the prices of these items have actually shown an upward trend even after 2024, when North Korea's military support to Russia intensified. Based solely on the data observed so far, it is difficult to conclude that the inflow of Russian goods has had a substantial impact on stabilizing prices within North Korea.

III. Constraints on North Korea-Russia Economic Cooperation

In June 2024, the 'Treaty on Comprehensive Strategic Partnership,' signed during President Putin's visit to Pyongyang, elevated the North Korea-Russia relationship from the level of the 2000 Treaty of Friendship, Cooperation and Mutual Assistance to that of a strategic partnership. This treaty explicitly outlines enhanced cooperation in trade, investment, finance, and science and technology. Despite this, what are the reasons for the lack of clear progress in economic exchanges between the two countries?

First, poor logistics infrastructure and high transportation costs are the biggest constraints. While North Korea and China are closely connected through 12 border crossing points, the only logistics link with Russia is the Tumen River-Hasan railway customs. This railway is unsuitable for large-scale logistics movement due to issues such as different track gauges, outdated infrastructure, and a shortage of freight cars. Furthermore, the long distance from inland Russia to North Korea results in excessively high transportation costs, which makes trade economically unviable for anything other than high-value-added goods.

Second, the non-complementary trade structure between the two countries is also a problem. Russia already produces sufficient quantities of minerals such as coal and iron ore, which are North Korea's main resource exports, thus limiting North Korea's export opportunities. Additionally, North Korea lacks competitiveness in electronic products and light industrial goods, which are major import items for Russia. These products are mainly procured from countries with strong price competitiveness, such as China and Vietnam.

Third, China's caution and lukewarm attitude are also obstacles to expanding North Korea-Russia economic cooperation. If China were to participate in North Korea-Russia economic cooperation and develop into trilateral cooperation, logistics efficiency would increase, and North Korea might be integrated into a China-led supply chain. However, as a permanent member of the UN Security Council, China is unlikely to participate in North Korea-Russia cooperation in a way that directly violates international sanctions. Furthermore, under its strategic policy of stably managing US-China relations, China maintains a passive stance towards the formation of a North Korea-Russia-China bloc, as this could negatively impact China's national interests.

IV. Conclusion and Implications

A more significant reason for the limited effectiveness of North Korea-Russia economic cooperation may be that North Korea prioritizes strategic compensation, namely access to advanced military technology, over economic compensation from Russia. North Korea may be more interested in receiving support for military technologies that are difficult to develop or acquire independently, such as launch vehicle technology for reconnaissance satellites, drones, electronic equipment, and anti-aircraft missiles.

Consequently, the international community needs to maintain surveillance on key items of existing economic sanctions against North Korea, such as the dispatch of workers and energy exports, while also strengthening surveillance on the export of military supplies and the transfer of advanced military technology. In particular, surveillance capabilities should focus on two pillars: expanding North Korea's military industry and blocking Russia's transfer of military technology.

South Korea needs to engage in diplomatic efforts toward China and Russia. With China, dialogue should be continued to prevent the realization of what North Korea calls a 'North Korea-China-Russia bloc' or a 'new Cold War order,' and practical cooperation should be sought in non-sensitive areas such as general-purpose technologies (GPT). Regarding Russia, diplomatic efforts should focus on blocking the transfer of military technology to North Korea. South Korea can emphasize that it remains a major economic partner, with bilateral trade reaching $15 billion even in 2023. Furthermore, by highlighting its potential as a reliable partner in the post-war development of the Russian Far East, it is necessary to induce Russia to refrain from military cooperation with North Korea. ■

References

<Yonhap News>. 2024. "Defense Ministry Estimates Approximately 20,000 Containers Shipped from Rajin Port to Russia." October 23. https://www.yna.co.kr/view/AKR20241023050300504(Accessed: May 13, 2025.)

<Yonhap News>. 2025. "National Intelligence Service: Casualties Among North Korean Troops Deployed to Russia-Ukraine War Exceed 4,700." April 30. https://www.yna.co.kr/amp/view/MYH20250430014600038(Accessed: May 13, 2025.)

Radio Free Asia (RFA). 2024. "Russian Media Express Anticipation for Putin's Visit to Pyongyang." June 18. https://www.rfa.org/korean/in_focus/nk_nuclear_talks/2024russia-dprk_summit_june-06182024144454.html(Accessed: May 13, 2025.)

■ Jeong Seung-ho, Head of the Department of International Trade and Logistics, Incheon National University

■ Management and Editing:Kim Chae-rin, EAI Research Assistant

    Inquiries: 02 2277 1683 (ext. 208) | crkim@eai.or.kr