North Korea, considered the world’s most isolated state, is expected to return to economic growth this year for the first time since the pandemic, as arms deliveries to support Russia’s invasion of Ukraine bolster state coffers.

Since August, North Korea has carried out transfers of about one million shells to Russia, according to South Korea’s National Intelligence Service.

Other reports say Pyongyang has also handed over ballistic missiles to the Russian military, citing US satellite imagery.
Both Pyongyang and Moscow have denied that any transfers have taken place.

The secret deal between North Korean President Kim Jong Un and his Russian counterpart Vladimir Putin is likely to further boost North Korea’s tiny, centralized economy, which South Korea’s central bank says was worth just 22.6 billion euro in 2022.

North Korea’s defense sector is one of the largest employers of the country, with approximately two million workers in a total population of 26 million. The industry contributes significantly to the economy, along with agriculture.

Initially just a supplier to its own military, North Korea has found some key overseas customers for its weapons and ammunition – mostly former Soviet countries or countries in sub-Saharan Africa. Most of the spare parts are imported from other countries subject to severe sanctions, including China and Iran.

North Korea is expected to earn at least $1 billion from the sale of artillery shells to Russia, Bloomberg News reported this week, while ballistic missiles ordered by Moscow typically cost several million dollars.

Fitch Solutions chief economist Anvita Basu noted how North Korea, along with Russia, is known for its advanced cyber-attack capabilities, with the state training thousands of hackers. “So this could be another kind of domain for the two sides to cooperate in the future”he said.