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COVID-19 Pandemic Dealing Harsh Blow to Many Korean Companies
Worried about Business Slumps
COVID-19 Pandemic Dealing Harsh Blow to Many Korean Companies
  • By Michael Herh
  • February 18, 2020, 13:52
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Six out of 10 Korean companies have been found to be concerned about business slumps due to COVID-19 infections.

Six out of 10 Korean companies are concerned about business slumps due to COVID-19 infections, the Korea Economic Research Institute (KERI) said on Feb. 16.

The institute, which is affiliated with the Federation of Korean Industries (FKI), announced the results of a recent survey conducted on the 1,000 largest companies in terms of sales to find out the impact of the COVID-19 outbreak.

About 62 percent of the respondents forecast that the COVID 19 outbreak would adversely affect their business performances. In particular, 83.9 percent of companies with production facilities in China expected a negative impact.

If the outbreak lasts for more than six months like the severe acute respiratory syndrome (SARS) which lasted for nine months from 2002 to 2003, or the Middle East respiratory syndrome (MERS) which lasted for eight months in 2015, sales and exports would decline 8.0 percent and 9.1 percent, respectively, and exports to China will plunge 12.7 percent on year, the survey said. If it subsides within six months, both sales and exports would drop 3.3 percent and 5.1 percent, respectively, and exports to China were forecast to contract 6.8 percent.

If it lasts for more than six months, sales will fall 13.9 percent for automobiles, 12.8 percent for auto parts, 12.4 percent for petroleum products and 11.0 percent for general machinery. In the same scenario, exports will decline 17.8 percent for petroleum products, 14.5 percent for automobiles, 11.6 percent for general machinery, 11.0 percent for auto parts exports, and 10.0 percent for petrochemicals.