North Korean economy shrinks for 2nd year in 2010

The North Korean economy contracted for the second straight year in 2010 due to tougher international sanctions and sluggish agricultural production, the South Korean central bank estimated Thursday, Yonhap News Agency reported.The Bank of Korea (BOK) estimated that North Korea's economy shrank 0.5 percent on-year last year, compared with a 0.9 percent contraction in 2009. The data stood in sharp contrast to the 6.2 percent expansion of the South Korean economy in 2010."Last year, the North Korean economy contracted as economic conditions at home and abroad worsened amid energy shortages and international sanctions and its manufacturing sector remained sluggish," Park Yung-hwan, an official at the BOK, was quoted as saying.North Korea suffers chronic food and energy shortages due to years of isolation, mismanagement and natural disasters. The communist state has relied on international handouts since 1995 to help feed its more than 20 million people.North Korea's nominal gross national income (GNI) amounted to KRW 30 trillion (USD 26.5 billion) last year, which is only 2.6 percent of South Korea's GNI, according to the BOK.