Worries Over Business Disruptions as Companies May Not Meet Overseas Buyers...

Overseas Business Trips and Project Plans Canceled One After Another
Business Disruptions Expected if Human Exchange Slows Down

Due to the impact of the novel coronavirus infection (COVID-19), major countries such as the United States and China have successively imposed travel restrictions and entry bans on Korea. Where does Korea stand?

[Asia Economy Reporters Moon Chaeseok, Jo Seulgina]

#1 Park Jung-ho, CEO of SK Telecom, who was scheduled to attend the board meeting of the Global System for Mobile Communications Association (GSMA) as a representative of Korea, stayed in the country as the meeting on the 24th was replaced by a video conference due to concerns about participants from Asia. GSMA had planned for 26 executives, including those from 25 member companies and the secretary-general, to meet separately to discuss current issues even after canceling the Mobile World Congress (MWC), the world's largest mobile exhibition. However, as concerns about the novel coronavirus disease (COVID-19) persisted and the number of confirmed cases in Asian countries remained high, an unprecedented decision was made to replace the meeting with a video conference.

#2 Meetings with overseas buyers through domestic and international exhibitions are also being disrupted one after another. For example, the Korea-Qatar Shipbuilding and Offshore Plant Partnership event, scheduled to be held in Changwon, Gyeongnam from March 11 to 13 with participation from 30 domestic companies and 10 overseas buyers, was canceled. Overseas buyers were supposed to meet with domestic companies for separate business meetings and contract signings, but most of these were canceled.

Due to the impact of COVID-19, major countries such as the United States and China have successively imposed travel restrictions and entry bans on Korea, posing another challenge to the industry. In particular, with the U.S. raising its travel advisory, it is expected that 'person-to-person exchanges' will slow down, causing significant disruptions to corporate business.

According to the government and industry on the 26th, the U.S. Centers for Disease Control and Prevention (CDC) raised the travel advisory for Korea from Level 2 (Exercise Increased Caution) to Level 3 (Avoid Nonessential Travel) on the 24th (local time), raising concerns that the real market will be affected. Until now, the issues were logistics restrictions within China, reduced factory operating days, and consequent trade declines, but now businesspeople must also worry about being turned away abroad due to personal restrictions.

The industry is concerned that the U.S. travel advisory for Korea is being reviewed by neighboring countries as well, making contact with overseas buyers more difficult. A representative of an automotive electronic parts company said, "We are already in a subordinate position overseas, and I am afraid that even foreign companies we have relationships with might impose entry restrictions," adding, "We gave up on our sales network expansion strategy early this year and now have to reorganize it."

The telecommunications industry is also expressing difficulties as overseas business trips have effectively stopped following the cancellation of the largest exhibition, MWC. Plans to conduct business meetings that were canceled due to MWC through individual contacts between staff and executives have also become difficult.

An industry official said, "As the number of COVID-19 confirmed cases rapidly increases in Korea, overseas partners are expressing anxiety," adding, "There are situations that require face-to-face contact, so there are some difficulties in business plans."

Experts urge the government to promptly present 'special measures,' such as measures for Chinese entry restrictions. Professor Jung In-kyo of Inha University's Department of International Trade said, "Since it is urgent to gain international trust in Korea's COVID-19 response capabilities in a short period, alternatives such as movement restrictions should be promptly proposed."