Strategic resilience for Korea’s supply chains

The war in the Middle East shows no signs of ending, prolonging instability in the supply and demand of energy and critical materials while driving further price increases. The closure of the Strait of Hormuz, one of the world’s most critical geopolitical and geo-economic chokepoints, and attacks on energy infrastructure are severely disrupting global production and supply chains. Oil prices have spiked to over $100 per barrel, exerting severe pressure on the Korean economy — one of the most oil-dependent in the world. The crisis is already undermining business confidence and dampening investment activity. If oil prices remain around $100 per barrel for a year or longer, Korea’s growth is expected to decline by 0.3 percentage points, while inflation is projected to rise by 1.1 percentage points, according to the Hyundai Research Institute. The closure of the Strait of Hormuz is also disrupting the helium supply from Qatar, which accounts for 33 percent of global production, undermining industrial activity in Korea and elsewhere. Helium is indispensable for semiconductor and wafer

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