December 22, 2024

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Hana Bank's dealing room in Seoul is seen as the Korean stock markets begin trading on Wednesday. (Yonhap)

Multinational companies doing business in Korea were thrown into confusion overnight as President Yoon Suk Yeol declared martial law, a drastic decision that was rescinded just six hours later.

Most firms swiftly responded by issuing emergency notices, instructing employees to work remotely, while their headquarters closely monitored the situation by directing their Korean teams to report on the potential ramifications.

"We stayed up all night monitoring fluctuating exchanges rates," said a manager from a foreign retail firm who wished to be unnamed. "While there’s no immediate impact compared to financial markets, the depreciation due to currency volatility will affect our products' valuation. We worked overnight to draft response strategies, assess the potential impact on our business and prepare announcements for our employees."

Another official working at a foreign firm in Seoul said, “Colleagues at the headquarters contacted me several times during the early hours, asking if I was safe. However, since the martial law was lifted so quickly, there hasn’t been an official follow-up notice from our head office yet.”

Emphasizing the gravity of the situation, the official, who also insisted on full anonymity to protect their company and industry -- expressed deep concerns about the potential impact on South Korea’s international creditworthiness and market reputation.

“It’s a relief that the situation didn’t last long, but had it been prolonged, we feared being isolated in Korea, which could have severely affected ongoing client relationships and exports to other countries.”

Another employee also shared, "I received a group text from my company around 12:30 a.m. about two hours after the martial law announcement, instructing all office staff to switch to remote work immediately."

The apprehension was echoed across various sectors, particularly in transportation and logistics, where companies braced for potential disruptions that could ripple through global supply chains and essential services.

"We weren’t entirely unprepared for the possibility of disruptions to civilian passenger and cargo flights, particularly given that Korea remains technically under an armistice," said an official from a foreign airline.

"We maintained close communication with the Transport Ministry as well as relevant airport authorities and closely monitored the situation. While our company's emergency protocols for wartime scenarios are in place globally, we speculated that domestic airlines like Korean Air, currently close to its merger, might experience significant confusion at such a tumultuous time."

By Kim Hae-yeon (hykim@heraldcorp.com)