 |
Smoke rises over Manama, Bahrain, following a loud explosion. (Photo: Yonhap News Agency) |
[Alpha Biz= Kim Jisun] Escalating military conflict between the United States, Israel and Iran is casting a shadow over South Korean corporations’ expansion strategies in emerging markets across the Middle East and broader “Global South” region.
According to industry sources on March 3, Samsung Electronics, Hyundai Motor and LG Electronics have effectively suspended business activities, including sales operations, across parts of the Middle East, prioritizing employee safety amid heightened security risks. While no official closures have been announced, companies have halted on-the-ground operations and activated contingency measures.
Samsung Electronics has reportedly relocated local staff to neighboring countries, while LG Electronics has advised employees to work remotely and take safety precautions.
The situation intensified after U.S. and Israeli strikes on Iran were followed by retaliatory actions targeting U.S. military bases in countries such as Saudi Arabia and the United Arab Emirates. Reports of explosions in Riyadh and other regional hubs have heightened concerns among Korean firms operating in the area.
Prior to the crisis, these companies had been expanding their presence in key Middle Eastern markets. Samsung Electronics operates sales subsidiaries in Riyadh, Saudi Arabia, and Dubai in the UAE, focusing particularly on business-to-business (B2B) segments such as HVAC systems. The company is also known as a leading player in the Saudi home appliance market and has been strengthening localized services, including Arabic-language integration for Galaxy AI and streaming platforms.
Samsung additionally operates manufacturing facilities in Beni Suef, Egypt, producing TVs, monitors and tablets, and maintains a research and development center in Israel, a country widely regarded as a technology startup hub. Chairman Lee Jae-yong personally visited Saudi Arabia, Israel and Egypt in October 2023, underscoring the company’s strategic focus on the region.
Industry observers warn that surging international oil prices and prolonged instability could force companies to revise business plans established late last year, potentially delaying investment and expansion initiatives across the Middle East.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
