South Korea’s economy faces enormous risks as trucker strike enters day seven

south korea trucker strike day seven

A strike by South Korean truck drivers has cost vital industrial sectors over $1.2 billion in unfulfilled deliveries and lost production, the government estimated, as the damage spreads deeper throughout the nation’s economy.

The truckers’ strike, now in its seventh day, has forced Hyundai Motor to cut production for certain assembly lines, steelmaker POSCO to halt some factories due to a shortage of space to store unshipped products, and cement makers in South Korea have also reduced output

Petroleum firms were also in pain, with average daily shipments from plants having tumbled 90% due to the strike as the protesting truck drivers targeted major petroleum complexes in Daesan, Ulsan, and Ulsan.

South Korea’s Cargo Truckers Solidarity union is protesting soaring fuel prices and demanding minimum pay guarantees. Until now, all four rounds of negotiation with the government have failed to find a compromise.

A researcher at Korea Institute for Industrial Economics & Trade, Kim Yang-pang, estimates SK Hynix and Samsung Electronics had stockpiled almost two weeks’ worth of raw materials.

The prolonged labor strike is a significant test for newly elected President Yoon Suk-yeol,  who assumed office five weeks ago, potentially distracting from his conservative agenda and raising the risk of long-term antagonism with powerful unions.

The nation’s government has urged the truckers to return to work but said it would seek to reflect their demands in the legislative process and keep trying to sort out the matter through dialogue.