South Korean business giants braced for disruptions to their exports yesterday after the country's worst typhoon on record ravaged its main port and left 115 people dead or missing.
At least 87 people were killed and 28 others were missing and feared dead from Typhoon Maemi, which slammed into South Korea's biggest port Busan on Friday with such intensity that it tossed shipping containers into the air and toppled gigantic cranes.
PHOTO: AFP
The government has allocated 1.4 trillion won (US$1.2 billion) for recovery efforts and estimated property damage alone at about 1.1 trillion won (US$996 million).
Losses from export slowdowns, disruptions and lost business opportunities were expected to amount to millions of dollars more. Busan normally handles 80 percent of the country's container shipping.
"Typhoon Maemi damaged exports in Busan port and it may postpone the economic recovery expected in the fourth quarter," said Daishin Securities analyst Kim Dong-Uk.
The government may struggle to achieve even 3 percent growth this year and is unlikely to meet its target of 3.5 percent because of the typhoon, the Korea Times reported.
The Ministry of Commerce Industry and Energy said the typhoon caused a temporary halt to operations at some 20 major companies on the southeastern coast.
On Monday, shares of major export-dependent electronics companies, property insurers, shipbuilding, oil refining and petrochemical companies fell on the Korea Stock Exchange, opening for the first time since Tuesday after a five-day thanksgiving holiday.
Among companies expected to be hit are LG Electronics, South Korea's second-largest mobile phone handset maker, Hyundai Heavy Industries, the world's largest shipbuilder, and Samsung, the world's biggest computer memory chipmaker.
Busan port handles 90 percent of LG's exports such as televisions, refrigerators, and computer monitors. LG Electronics said it is considering switching deliveries from Busan, to other ports to meet export deadlines.
"We report no damage so far, but plan to switch some 25 percent of our export to Gwangyang Port and Masan Port," said an LG spokesman, speaking on condition of anonymity.
The typhoon toppled eight container-lifting cranes and damaged three others in Busan. Government officials said it would take at least 15 months to restore the cranes.
Samsung Electronics Co said its semiconductor goods and mobile phones, which account for 60 percent of its exports, are shipped out by air. But the remaining 40 percent of its exports go through Busan, comprising television sets, computer monitors and other electronic goods.
Hyundai Heavy Industries said one of its vessels collided with a chemical tanker being built at Hyundai Mipo Dockyard, damaging both ships. The damage was estimated to be between 5 billion won (US$4.2 million) and 7 billion won (US$5.9 million), the company said, adding that insurance should cover the cost.
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