South Korea’s government will meet a striking truckers’ union on Monday for the first talks of a five-day nationwide walkout, as supply chain glitches worsen and concrete runs out at building sites.
The government, which estimates daily losses at about 300 billion won ($224 million) as supplies of cement and fuel for gas stations run short, raised its warning of cargo transport disruption to the highest level.
But the union held out little prospect of a breakthrough in the second major strike within less than six months, as thousands of truckers demand better pay and working conditions.
“The transport ministry’s position is already set, and there is no room for negotiations, so this meeting is not a negotiation … the content is a demand for an unconditional return to work,” the union said in a statement on Sunday.
The strike is disrupting industrial activity at a time when Asia’s fourth-largest economy, which is dependent on exports, faces lower-than-expected growth next year, with the central bank having downgraded its 2023 forecast to 1.7% from 2.1%.
“We need to establish a rule of law between labour and management,” President Yoon Suk-yeol Yoon said on Monday, according to the presidential office.
Yoon, who has criticised the strike as taking the nation’s logistics “hostage” in the face of an economic crisis, will hold a cabinet meeting on Tuesday to consider a ‘work force order’ for truckers to return to their jobs, his office said.
The law allows the government to issue such an order during a serious transport disruption, and failure to comply can be punished with up to three years in jail, or a fine of up to 30 million won ($22,550).
Strike organiser the Cargo Truckers Solidarity Union (CTSU) has criticised the government for being unwilling to expand a minimum-pay system beyond a further three years, instead of meeting union demands to make it permanent and widen its scope.
Container traffic at ports was 21% of normal levels by 10 a.m. (0100 GMT) on Monday, the transport ministry said, against Friday’s figure of 49%.
The steel industry, including POSCO (005490.KS) and Hyundai Steel (005490.KS), saw shipments more than halve to 22,000 tonnes on Sunday, down from the usual average of 46,000 tonnes, the transport ministry said.
Some gas stations could run out of gasoline and kerosene as early as this week, especially in large cities, despite supplies secured ahead of the strike.
Since last week, 259 out of 459 building sites have suspended ready-mix concrete work, the Yonhap news agency said, while the transport ministry said most sites were expected to run out by Tuesday.
The cement industry estimated an accumulated output loss of about 46.4 billion won ($35 million) by Saturday, with shipments down to 9% of usual levels, the Korea Cement Association said.
“Non-union bulk cement truck owners, who are implicitly sympathetic to, or in fear of, the cargo union’s illegal activities, are giving up cement transport,” the lobby group said in a statement.