weighted score 6.2 · five dimensions
Geopolitical & Concentration Risk
North Korea
Geopolitical conflict, sanctions exposure, nuclear programme risk and policy continuity intelligence for North Korea-origin supply chains.
Geopolitical conflict
7
Nuclear weapons programme declared 'irreversible'. Korean Peninsula armistice (no peace treaty). Periodic missile tests and provocations. Defence 15.8% of budget. 2026 WPK Congress: 'nuclear completion'.
Supplier concentration
3
Direct sourcing prohibited under sanctions. No legitimate supply chain dependency. Indirect contamination via Chinese/Russian intermediaries is the risk vector.
Climate & physical risk
3
Periodic flooding and drought. Chronic food insecurity. No independent data. Physical risk is real but irrelevant for sourcing given sanctions prohibition.
Sanctions exposure
9
Most sanctioned country globally. Comprehensive UN, EU, and US sanctions. Trade, financial, transport, and investment prohibitions. Secondary sanctions risk for third parties. Maximum score.
Policy continuity & property rights
9
Totalitarian single-party state. No rule of law. No property rights. No independent judiciary. Heritage Freedom 177/177 (dead last). KPW at 21,700/USD. No transparent governance.
Geopolitical Exposure
Geopolitical Exposure
- Nuclear programme
- North Korea declared nuclear weapons status 'irreversible' under Kim Jong Un. Defence spending estimated at 15.8% of budget. 2026 WPK Congress agenda includes 'nuclear completion' — assessed as warhead miniaturisation and delivery system diversification.
- Korean Peninsula
- The Korean War (1950-1953) ended with an armistice, not a peace treaty. The DMZ remains one of the world's most militarised borders. Periodic provocations (missile tests, border incidents) maintain elevated tension.
- Regional dynamics
- Strategic relationships with China (primary economic lifeline) and Russia (deepening military cooperation since 2022). DPRK workers deployed to Russia. Adversarial relationships with South Korea, Japan, and the United States.
- Buyer implication
- Direct sourcing from North Korea is prohibited under sanctions. The risk for EU buyers is indirect exposure through Chinese, Russian, or Southeast Asian supply chains that may contain DPRK-origin materials or labour.
Supply Chain Concentration
Supply Chain Concentration
- Export profile
- Pre-sanctions exports included coal, iron ore, textiles, and seafood. UN sanctions have prohibited most commodity exports since 2017. Sanctions evasion through ship-to-ship transfers and Chinese intermediaries is documented.
- Indirect supply chain risk
- DPRK-origin coal and minerals have been documented entering Chinese supply chains. Textiles manufactured by DPRK workers in China and Southeast Asia have entered global supply chains. Seafood transhipped via Chinese ports.
- Alternative sources
- For any commodity previously sourced from DPRK, abundant alternatives exist globally. The supply chain risk is not about substitution difficulty but about detecting and preventing DPRK-origin content in multi-tier supply chains.
- Concentration risk
- Supplier concentration risk is effectively zero for direct sourcing (prohibited). Indirect contamination risk in Chinese and Russian supply chains is the relevant concern for compliance teams.
Climate & Physical Risk
Climate & Physical Risk
- Flooding & drought
- North Korea experiences periodic severe flooding (especially in northern provinces) and drought. Agricultural production is vulnerable — food insecurity is chronic. No independent climate data is available.
- Deforestation
- Satellite imagery shows extensive deforestation driven by fuel wood harvesting and agricultural expansion. Hillside erosion exacerbates flooding risk.
- Infrastructure
- Energy infrastructure is severely degraded. Power generation is unreliable. Transport infrastructure is in poor condition. No independent assessment of climate resilience is possible.
- Data limitations
- No independent environmental or climate data is published. All assessments rely on satellite imagery and defector testimony. Climate risk scoring reflects physical geography and satellite-observed conditions.
Sanctions & Policy Continuity
Sanctions & Policy Continuity
- UN sanctions
- Comprehensive UN sanctions under Security Council resolutions 1718, 2270, 2321, 2356, 2371, 2375, and 2397. Prohibitions cover coal, iron, textiles, seafood, crude oil (capped), refined petroleum (capped), and luxury goods. Financial sanctions restrict banking relationships.
- EU sanctions
- EU autonomous sanctions under Council Decision (CFSP) 2016/849 exceed UN requirements. Comprehensive trade, financial, and transport restrictions. Investment prohibition. Technology transfer ban.
- US sanctions
- Maximum pressure campaign. OFAC SDN designations covering DPRK entities and individuals. Secondary sanctions risk for non-US persons dealing with DPRK. Treasury Department actively enforces.
- Policy continuity
- Kim Jong Un exercises absolute power. No succession mechanism is transparent. New 5-year economic plan announced but no independent data on implementation. KPW at 21,700/USD (January 2025). Heritage Economic Freedom: 177/177. Population ~26M.