Asia Minute: South Korea’s lingering truck strike threatens a broader economic impact
The price of oil has spiked around the world — and gasoline prices have followed suit. That’s affecting the delivery price of some goods, but in one Asia country, there’s another complication.
Truck drivers have now been on strike in South Korea for a little more than a week.
Drivers currently have a guaranteed minimum wage — linked to a national system of freight rates — but it’s set to expire at the end of the year.
Union members fear that rising fuel prices will lead companies to preserve profit margins by cutting wages.
The Transport Ministry estimates about a third of the country’s 22,000 union truckers are out on strike. The union says even more are staying off the road.
Initial impacts were largely felt by industries from cement and steel to petrochemicals — and then began to move through the supply chain.
The Joong Ang Daily reports a shutdown of cement shipments has led more than half the country’s concrete factories to suspend operations.
Automakers have been unable to move finished cars from factories to consumers.
The longer the strike lasts, the deeper its threat to international exports — from cars to smartphones.
Port traffic is already slumping — Yonhap News reports the number of shipping containers moving in and out of South Korea’s largest port of Busan is running at about a quarter of its usual level.