South Korea is now on its seventh day of strike, as the country’s economy faces risks

South Korea is now on its seventh day of strike, as the country’s economy faces risks

Web Desk
June 13, 2022

South Korea is now on its seventh day of strike, as the country’s economy faces risks

On Monday, a strike by South Korean truckers reached its seventh day, putting the country’s new president to the test and putting more strain on Asia’s fourth-largest economy, which is already struggling with stagflationary pressures.
The strike by unionised truckers seeking higher pay has slowed the shipment of components and finished goods for the automobile, steel, cement, and liquor industries in the export-driven economy of Busan.
Long-term labour unrest might put President Yoon Suk-yeol, a political newcomer who took office just five weeks ago, to the test, perhaps detracting from his conservative agenda and heightening the danger of long-term animosity with the opposition.

On Monday, a strike by South Korean truckers reached its seventh day, putting the country’s new president to the test and putting more strain on Asia’s fourth-largest economy, which is already struggling with stagflationary pressures.

The strike by unionized truckers seeking higher pay has slowed the shipment of components and finished goods for the automobile, steel, cement, and liquor industries in the export-driven economy of Busan.

POSCO (005490.KS), a Korean steelmaker, plans to shut down several of its operations starting Monday due to a lack of storage space for unshipped goods. Hyundai Motor (005380.KS) has reduced output on some lines.

Long-term labour unrest might put President Yoon Suk-yeol, a political newcomer who took office just five weeks ago, to the test, perhaps detracting from his conservative agenda and heightening the danger of long-term animosity with the opposition.

A union spokesman said hundreds of strikers were expected to join the 100 or so who gathered on Sunday at the main gate of a massive Hyundai Motor industrial complex in the southern city of Ulsan near Busan.

According to local media, dozens of people have been detained by police, although the protests have been generally peaceful thus far. Yoon’s government and the union have met four times but have yet to strike an agreement.

around a fourth of the Cargo Truckers Solidarity union’s 22,000 members were anticipated to be taking part in industrial action, protesting rising fuel prices and seeking minimum wage guarantees, according to the land ministry.

The ministry has urged the truckers to return to work, but has also stated that it will endeavour to represent their requests in the legislative process and will continue to engage with the union to resolve the conflict.

The truckers are asking for an extension of subsidies that guarantee minimum salaries when fuel prices rise, which are slated to expire this year. The government claims that it is up to parliament to decide whether or not to modify the law.

Any extended delay in the production and shipments of chips, petrochemicals, and automobiles, as the global economy suffers with supply bottlenecks, might add to fears about increasing inflation and declining GDP.

South Korea’s inflation is expected to approach a 24-year high of 4.8 percent this year, according to the Organization for Economic Cooperation and Development.

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