SOUTH KOREA REPORT
The declaration of martial law by South Korean President Yoon Suk Yeol has sparked a series of strikes by labor unions. The unions, which are the support base for the opposition parties calling for the president’s resignation, are mobilizing up to 200,000 people. Major industries such as the automobile industry are already affected.
The strike was led by the umbrella organization, the National Metal Workers’ Union. In addition to Hyundai Motor, which is a member of the union, more than 70,000 workers from other companies that support the Korean auto industry, such as Kia Motors, GM Korea and Hyundai Mobis, an auto parts manufacturer, have joined the strike.
There have also been production problems. According to company estimates, the number of cars produced by Hyundai Motor and GM Korea fell by about 3,600 and 1,000 to 2,000 respectively because of the series of strikes. The metalworkers’ union has said that if President Yoon does not resign, it will launch an indefinite general strike. The strike could last for a long time and the impact on production could be significant.
Source: The Nikkei
PSR Analysis: The declaration of martial law by the South Korean president reportedly has had a huge impact on the domestic economy. If the political turmoil continues, it will have an impact on the domestic manufacturing industry. At the time of this writing, the turmoil is still in full swing, and it is believed that it will take some time before it is completely over.
The activities of the South Korean manufacturing unions are known to be extremely intense, and if this political turmoil increases, it could upset the economic. The South Korean economy is deteriorating due to sluggish domestic demand caused by inflation, increases in the minimum wage, and a sluggish Chinese economy, which is the largest export destination.
The declaration of martial law has led to a weakening of the won in foreign exchange and a turbulent stock market. If the unstable political situation continues, it could lead to a decline in industrial competitiveness. PSR
Akihiro Komuro is Research Analyst, Far East and Southeast Asia, for Power Systems Research
