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Socio-economic System

Relations of Ownership and Supreme Principle of State Activities

The ownership of the means of production by the State and by social and cooperative organizations constitutes the economic basis of the DPRK as two forms of socialist ownership of the means of production.

The State ownership is an all-people ownership and there is no limit to the property which the State can own.

Accordingly, the people are equal in the ownership of the means of production and take part in the work of managing the national property. The State ownership is used for the development of the country and the promotion of the people’s well-being.

The ownership of social and cooperative organizations is the collective ownership of the working people involved in the organizations concerned. It includes land, farm machinery, ships and small- and medium-sized factories and enterprises.

The State enhances the leading role of the all-people ownership over the cooperative ownership so as to combine the two forms of ownership in an organic way, consolidates and develops the socialist cooperative economic system by improving the guidance and management of the cooperative economy and gradually transforms the cooperative ownership into the all-people ownership as a whole based on the voluntary will of all their members.

Private ownership is derived from socialist distribution according to work done and from supplementary benefits granted by the State and society. It includes the products of individual sideline activities including those from kitchen gardens, as well as income from other legal economic activities. The State protects the private ownership of the working people and guarantees by law the right to inherit it.

The State regards it as the supreme principle of its activities to steadily improve the material and cultural standards of the people.

The State takes care of the people as the master responsible for their livelihood.

Workers, farmers and office workers exercise the right to labour to their heart’s content and enjoy supplementary benefits from the State in addition to the distribution according to work done. They are provided with modern dwelling houses free of charge as well as enough conditions for labour protection and education. The country offered accommodation at health resorts and holiday homes at its own expense even around the end of the last century when the economic situation of the country was at the worst.

The DPRK applied a tax system for the sake of the people and gradually lowered the tax. It abolished the agricultural tax-in-kind in the mid-1960s and the tax system completely in the 1970s.

Social Welfares

Working women are granted maternity leave (60 days before delivery and 180 days after delivery) irrespective of the length of service, in addition to regular and supplementary leave. Those with three or more children are allowed 6-hour workday and receive the same amount of salary as those on an 8-hour workday.

The women who gave birth to three or more children at the same time and those children are looked after by special doctors, and they receive extra benefits from the State, including homes, medicines, foodstuffs and household goods.

Welfare beneficiaries enjoy all benefits of social security from the State.

Those who lost working abilities for life or temporarily due to illness or injury and for any other reason are provided with allowances and conditions for medical treatment and living.

The persons with disabilities, like those who are healthy, are treated with respect and enjoy equal rights, freedom and interests.

The elderly people (men above 60 and women above 55) receive old-age pensions and the old people and children with no one to support them are provided with ample living conditions free of charge by the State.

The revolutionary fighters and other meritorious people who distinguished themselves in the revolutionary struggle, heroes, war veterans, honoured disabled soldiers and others who performed exploits in defending the country and promoting socialist construction are given preferential social treatment, and the State takes good care of their living on its own responsibility. Under the close concern of the Workers’ Party of Korea and the State baby homes, orphanages and orphans’ primary and secondary schools have been built in an excellent fashion in Pyongyang and provinces.

Rest homes across the country provide every convenience for the comfort of the old people with no one to look after them.

Principle and System of Economic Guidance and Management

The DPRK firmly adheres to the principle of properly combining political guidance with economic and technical guidance, the unified guidance of the State with the creativeness of each unit, unitary direction with democracy, and political and moral incentive with material incentive in the guidance and management of the socialist economy.

The State directs and manages the national economy through the Taean work system, a socialist form of economic management whereby the economy is operated and managed scientifically and rationally on the basis of the collective efforts of the producer masses, and through the system of agricultural guidance whereby agricultural management is conducted by industrial methods. It enforces the self-accounting system in economic management to meet the requirements of the Taean work system and make proper use of such economic levers as cost, price and profit.

The national economy of the DPRK is a planned economy. The State ensures a high rate of growth in production and a balanced development of the national economy by implementing unified and detailed planning.