IFAD in the Democratic People's Republic of Korea
The first IFAD-funded project in the country became effective in 1996, when the economy was struggling to overcome the loss of its main foreign markets in Eastern Europe. The organization has invested a total of US$98.1 million in three projects in D.P.R. Korea.
Initially IFAD invested US$15.7 million, out of a total cost of US$24.2 million, in the Sericulture Development Project, to develop silk production in some of the country's poorest mountainous rural areas. The objective was to reduce rural poverty where farmland was scarce and at the same time contribute to strengthening the nation's light industry.
In December 1997 IFAD approved a US$28.9 million loan to support the activities of the Crop and Livestock Rehabilitation Project, which had a total cost of US$32.1 million. The project was designed to revitalize the rural areas that were most severely damaged by the natural disasters in the late 1990s.
Another IFAD loan of US$24.4 million supported the Upland Food Security Project, which had initially foreseen a total cost of US$41.7 million and which was intended to mobilize grant funding from a number of international donors. The project closed 30 June 2008.
IFAD's strategy in the Democratic People's Republic of Korea
With the objective of reducing rural poverty, IFAD operations in the country focus on stimulating agricultural production, particularly in the remoter, more disadvantaged upland areas in which there is a food deficit. In those areas, the organization has identified a good potential for expansion of crops such as potatoes and fodder crops for small animals.
Food production is the immediate priority in response to acute or chronic hunger, but IFAD investments also have the strategic longer-term aim of supporting sustainable agriculture and crop diversification. In D.P.R. Korea activities funded by IFAD operate in the context of the cooperative farms that are the basic building blocks of the country's rural economy. IFAD has gained a particular niche in D.P.R. Korea through its support for credit initiatives providing households with credit for income-generating activities and development of small-scale enterprises. The emerging farmers' markets, where farmers can sell their surplus production, promote the growth of market activity and contribute to strengthening the national economy.
IFAD's strategy in D.P.R. Korea includes building partnerships with other donors, bilateral and multilateral agencies and NGOs working in the rural and agriculture sectors.