The Korean peninsula juts out from the Asian mainland between the Sea of Japan and the Yellow Sea. The Democratic People's Republic of Korea (North Korea), which occupies the northern portion of the peninsula, has a population of about 24 million. It is bordered by China and Russia to the north and by the Republic of Korea (South Korea) to the south. Pyongyang, North Korea's largest and most modern city, with skyscrapers, broad boulevards, cultural centers, and sports stadiums, is its national capital.
Mountains and valleys characterize most of the country. Less than 20 percent of the land is arable. However, the valleys and western coastal plains have relatively rich alluvial soils. This is where most of the rural population lives. There is only sparse settlement in the interior where land is not arable.
North Korea's food production peaked in 1989-90, but has been falling since due to deforestation, which causes flooding, and heavy use of chemical fertilizers, which has led to lower soil fertility. Food production is largely carried out on cooperative farms involving an estimated 37% of the population. Families receive an annual quota of food from the harvest and the surplus is bought by the state and sold back to the non-farm population at low prices.
North Korea has a command (centralized) economy. The means of production are controlled by the state, and priorities and emphases in economic development are set by the government. North Korea was the better endowed part of the Korean Peninsula when Japan ended its occupation in 1945. The north has a wealth of minerals and other natural resources, but it has been hobbled by its rigid Communist model, by huge spending on the 1.2 million member armed forces, and by the collapse of trading partners in the former Communist world. Now, it lacks oil, electricity and fuel.
Beginning in the 1600's, Korea's rulers closed the country to all foreigners for almost 200 years and was called the "Hermit Kingdom" during this period. However, in the 19th century Japan became increasingly important in Korean affairs and, in 1876, forced Korea to open some ports to trade. By 1910, Japan took complete control over the country. The Japanese governed Korea as a colony to benefit their own interests, and took over management of Korean farms and businesses.
Korea remained under Japanese control until 1945, when Japan was defeated in World War II. As a result of the peace treaty, US troops occupied the southern half and Soviet forces occupied the northern half of the country. Neither felt that this was a satisfactory solution, and both countries tried to develop a plan for reuniting Korea, but failed. The UN proposed supervised national elections, but the Soviet Union refused to allow its representatives into the North. In 1948, South Korea elected a National Assembly, which drew up a constitution and elected a president. In response, the UN declared that this republic was the only lawful government. Meanwhile, in northern Korea, the Communists announced the formation of the Democratic People's Republic of Korea, and the USSR recognized this state as the only lawful government.
In 1950, North Korean troops invaded the South. In response, the UN Security Council approved a resolution condemning this invasion and sent armed contingents to aid South Korea. The United States furnished the great bulk of the military aid. An armistice was finally signed in July 1953, with neither side winning a complete victory. The war resulted in great loss of life and devastation to both parts of the country. Two-fifths of Korea's industrial facilities were destroyed and one-third of its homes devastated.
After the war, North Korea's economy grew rapidly, but then tended to stagnate or to grow only slowly. It was one of the most isolated and inaccessible countries in the international community, with severe restrictions on travel into and out of the country, a totally controlled press, and an ideology of self-reliance. Only communist nations, such as the Soviet Union, China and the countries of eastern Europe, were recognized as possible trade partners and sources of aid. Korea's stress on defense and heavy industry diverted manpower and financial support from the production of daily commodities. Farmers migrated to the city, producing a severe farm labor shortage. This situation was aggravated, in part, because of a threefold increase in population from 1954 to 1994. As a result, North Korea could not feed its population from its own resources and depended upon the Soviet Union and Eastern European countries to make up the deficit. With the breakup of the Soviet Union, this source of food supply was dramatically decreased, with resulting hardship.
However, politically, North Korea became less isolated when, in 1991 it was recognized by the UN as a separate country from South Korea.