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South Korea Truck Drivers Strike Drives Economic Concerns

The Korean Petrochemical Industry Association said today (June 13) that average daily shipments of petrochemical products in South Korea have dropped by 90% since the domestic truck strike.

Since members of the Cargo Truckers Solidarity union began nationwide protests on June 7, volumes have dropped 10% to 74,000 tons, according to the industry association.

More people were expected outside the main gate of the Hyundai Motor Plant in the southern city of Ulsan, near Busan, on Monday than on Sunday, according to the union.

The strike is now in its seventh day, exacerbating tensions in Asia’s fourth-largest economy, which is already under intense pressure.

Steelmaker POSCO plans to shut down some plants starting Monday because there is no space to store undelivered products. Automaker Hyundai Motor has cut production at some of its assembly lines.

The ministry has called on truck drivers to return to work. However, it said it would try to take their demands into account in the legal process and settle the conflict through negotiations with the unions.

As the global economy struggles with supply constraints, continued slowdowns in chip, petrochemical and automotive production and shipments could raise concerns about rising inflation and slowing growth.

The Organization for Economic Cooperation and Development (OECD) said last week that inflation in South Korea will hit a 24-year high of 4.8% this year, and lowered its growth forecast to 2.7% from 3.0% in December.

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