North Korea welcomed 2025 in a much stronger position than it was at the start of 2024, thanks to a revived alliance with Russia, an amicable relationship with China, and weakened international sanctions. The Korean Central News Agency described 2025 as a “year of great turn for raising the overall development of socialism onto a higher stage.” North Korean Chairman Kim Jong Un stressed the importance of bolstering the country’s defense industry and improving the economic efficiency in rural areas under the “Regional Development 20×10 Policy.”
Despite some assessments that North Korea had made the strategic decision to go to war against South Korea after Pyongyang shunned peaceful reunification with Seoul, North Korea exercised a degree of restraint throughout 2024. Although Pyongyang sent 10,000 troops to aid Russia in its war against Ukraine, in exchange for Russian economic and technological rewards, those troops do not wear North Korean military uniforms, arguably an effort to conceal their identities. When South Korea sent drones to drop anti-North leaflets over Pyongyang in October, North Korea did not resort to the use of force as a means of retaliation. Some analysts have suggested that South Korea’s President Yoon Suk-yeol was trying to provoke North Korea with the leaflet drops, in hopes of justifying his plans to declare martial law. North Korea even kept silent in the early days of South Korea’s political turmoil after Yoon’s short-lived martial law declaration last month, and only commented on the development after the motion to impeach Yoon was introduced by the opposition Democratic Party.
North Korea has been too occupied with helping Russia in Ukraine, and making money, to care about South Korea’s political crisis. There are many indicators that North Korea will double down on making money for itself instead of making war against South Korea in 2025.
The first indicator is Pyongyang’s investment in its defense industry. Russia’s need for ammunition and ballistic missiles is proving to be a godsend to the North Korean military-industrial complex, as North Korea now finds itself with a massive consumer for military exports. Before the war in Ukraine, North Korean weapons plants struggled to operate at full capacity due to a lack of raw material and power despite its existing weapons exports to Iran and Syria. Pyongyang has significantly increased the productivity of its existing weapons factories to meet Russia’s needs. Pyongyang also channeled Russian payments in flour to its workers in war-relevant factories to keep them running at full capacity. Kim’s frequent visits to these factories since the Russia-Ukraine War began, his showcase of North Korean weaponry at the 2023 defense expo to Russian Defense Minister Sergei Shoigu, and his initiative to establish “national defense industrial enterprise under the Second Economy Commission” in early 2024 underline North Korea’s strategy to boost weapon exports to capitalize on the war in Ukraine for financial gains.
In addition to selling arms to Russia, each North Korean soldier is paid $2,000 per month by the Russian government. U.S. intelligence claimed that North Korea sending troops to Russia was Kim’s idea, highlighting his need to make money. The technological assistance that Russia has offered in exchange for North Korea’s weapons and manpower will be vital to reviving the latter’s defense industry and to expanding the number of potential arms buyers going forward. The bottom line is that North Korea’s investment in its defense industry is not necessarily preparation to wage a war of unification against South Korea. A country on the precipice of war with its neighbors would not be selling arms and sending troops off to a distant conflict.
North Korea’s growing attention to rural development is also a reliable indicator of its peaceful intention vis-à-vis the South and its focus on making money. In January 2024, Kim admitted that the government’s failure to provide basic necessities and food to the people posed a “serious political problem.” The post-COVID-19 economic hardship demands government action to soothe public discontent. Pyongyang’s solution has been to invest more in producing consumer goods and to bridge the urban and rural living standards by building modern factories in 20 cities over the next 10 years.
However, rural areas seriously lack labor and raw materials and the government is also short of capital to purchase equipment and upgrade infrastructure. There are internal doubts whether the government can meet the 20×10 target. To make up for these shortages, besides ramping up its propaganda on the importance of the 20×10 Policy, North Korea has enlisted the military in constructing new factories. Assigning the military with domestic economic tasks highlights North Korea’s intention to not wage a war against South Korea anytime soon.
Russian money in exchange for North Korea sending troops will also provide the capital for domestic economic development. At the same time, expanding trade relations with China will assist Pyongyang with its domestic economic priorities and requires North Korea to commit to non-aggression with South Korea. In short, North Korea’s dismal economy and its serious implementation of the 20×10 Policy counsel against war.
Efforts to revive the tourism industry provide the last clear indicator of North Korea’s money-making objective. North Korea attempted to make good use of its charm offensive in 2018 and 2019 to invite more foreign guests; however, such a plan was halted due to the pandemic. In 2024, North Korea opened itself to a limited number of Russian and Chinese tourists. 2025 will be the year the country is fully back in the tourism business. In preparation for the grand reopening, Pyongyang is expanding the tourism facilities in Mount Chilbo in North Hamgyong Province bordering both China and Russia and in Mount Paektu in Yanggang Province. It is also reshuffling old personnel with younger people trained by tourism colleges at key resort facilities in the Mount Kumgang tourism zone to boost efficiency. Kim’s recent visit to the new Wonsan-Kalma resort area, which he considers central to North Korea’s tourism industry, highlights his intention to use money from tourism to fund his regional economic development project. A country contemplating war with its neighbor is not about to welcome back foreign tourists.
North Korea’s growing investments in the defense industry, rural development, and tourism business in service of national economic growth after the pandemic provide a comprehensive picture of its money-making intention. Although North Korea’s decision to send troops to Russia contributes to its deteriorating relations with the United States and South Korea, the decision is more about earning Russian cash than to invite a war with the South. If North Korea was eager for a fight, it would have capitalized on Yoon’s anti-North rhetoric in his martial law declaration to strike.
With its eyes set on financially benefiting from the Russia-Ukraine War, Pyongyang will continue downplaying the return of U.S. President Donald Trump, especially if Trump fails to come up with a lucrative enough deal to compete with Russia’s technological and economic rewards. Whether North Korea will have to fight a war against the South in 2025 depends more on South Korea’s ability to restrain itself than on Pyongyang’s willingness to fight a war of unification.