Economic Groups: "Relieved by Cargo Solidarity Strike Withdrawal... Sunset of Safe Freight Rate System to Be Addressed in National Assembly" (Comprehensive)

FKI, KCCI, and KITA to Announce Statement on Strike Withdrawal on the 15th

"2 Trillion Won Loss... National Assembly to Reconsider Continuation of Safe Freight Rates"

A press conference urging government dialogue in support of the Cargo Solidarity General Strike, hosted by the Seoul Headquarters of the Korean Confederation of Trade Unions (KCTU), was held in front of the People Power Party headquarters in Yeouido, Seoul on the 13th. (Image source=Yonhap News)

[Asia Economy Reporter Moon Chaeseok] Major economic organizations expressed relief that the nationwide general strike by the Cargo Solidarity Headquarters of the Public Transport Workers' Union under the Korean Confederation of Trade Unions (Cargo Solidarity) has come to an end on the 15th, but also expressed regret that the sunset clause of the Safe Freight Rate System was not upheld.

The Federation of Korean Industries (FKI) urged the Cargo Solidarity to "work hard to normalize logistics" following the end of the strike.

In a statement issued under the name of Choo Kwang-ho, head of the Economic Headquarters of the FKI, the organization said, "We consider it fortunate that the Cargo Solidarity has withdrawn its collective refusal to transport and decided to return to the transportation sites," adding, "This collective refusal to transport was prioritized over sufficient dialogue and discussion regarding the Safe Freight Rate System, and procedurally it is not considered desirable."

The Safe Freight Rate System was introduced with the purpose of guaranteeing appropriate wages for cargo drivers to prevent overwork, overloading, and speeding. It was a three-year sunset system, scheduled to be abolished at the end of the year.

The FKI explained, "Moreover, the transportation refusal, which occurred amid growing domestic and international uncertainties such as global supply chain instability and rising raw material prices, paralyzed the national logistics system and posed a serious threat across the entire industrial sector," adding, "In the future, we must solve the difficulties facing our economy together through reasonable dialogue and cooperation." It continued, "Now, more than ever, given the difficult domestic and international economic situation, all citizens must unite to overcome the crisis," and added, "Since the Cargo Solidarity has withdrawn its collective refusal to transport, we hope they will promptly return to the field and work even harder to normalize logistics."

The Korea Chamber of Commerce and Industry (KCCI) emphasized that while it is fortunate the strike has ended, the issue of the sunset clause of the Safe Freight Rate System cannot be overlooked. Since the National Assembly, not the government, holds the decision-making power, a full review and improvement plan should be prepared by the Assembly in the future.

In a statement, the KCCI said, "We consider it fortunate that the Cargo Solidarity's collective refusal to transport, which caused a massive loss of around 2 trillion won to the national economy, was withdrawn before it spread to cause greater damage across the industrial sector."

They pointed out limitations in negotiations with the Ministry of Land, Infrastructure and Transport, noting that existing agreements, such as the sunset of the Safe Freight Rate System, were not properly upheld due to pressure from labor groups. The KCCI stated, "We regret that the existing agreement on the year-end sunset of the Safe Freight Rate System was not honored and that the economic sector's position on operational issues raised so far was not reflected." The KCCI argued, "Since the sunset system of the Safe Freight Rate is a matter for the National Assembly, not the government, a comprehensive review and improvement plan regarding the continuation of the Safe Freight Rate System, which imposes a unilateral burden on shippers, should be prepared during the Assembly's future discussions."

The Korea International Trade Association (KITA) also welcomed the Cargo Solidarity's return to work but clearly opposed the continued promotion of the Safe Freight Rate System.

In a statement, KITA said, "The trade industry welcomes the Cargo Solidarity's decision to return to work. Although the eight-day transportation refusal has already dealt a serious blow to the nation's major industries and exports, we expect the Cargo Solidarity to promptly resume work and join efforts to normalize industry and exports."

However, KITA expressed deep concern and opposition to the agreement between the Ministry of Land, Infrastructure and Transport and the Cargo Solidarity to continue promoting the Safe Freight Rate System. The association stated, "Our trade industry has consistently expressed the position that the system imposes a unilateral burden on shippers from the legislative discussions on the Safe Freight Rate System until today," adding, "The continued promotion of the Safe Freight Rate System, which does not consider market functions, is feared to reduce domestic production by companies and weaken international competitiveness." Furthermore, it emphasized, "We hope that unilateral power plays like this by the Cargo Solidarity, which hold the national industry and economy hostage to enforce demands, will not be repeated."

Earlier, the Cargo Solidarity began a general strike on the 7th but reached an agreement with the Ministry of Land, Infrastructure and Transport the day before to temporarily extend the Safe Freight Rate System for cargo truck drivers, which was scheduled to end this year. From that day, the Cargo Solidarity decided to stop the collective refusal to transport and resume logistics transportation.