SMEs hit hard by Middle East crisis; nearly 30% have less than a month's inventory

South Korean small and medium-sized enterprises (SMEs) are experiencing critical inventory shortages, with nearly 30% reporting less than a month's supply of raw and intermediate materials. This alarming situation stems directly from the escalating geopolitical tensions in the Middle East, which are disrupting global supply chains.

The impact is particularly severe for SMEs that rely heavily on imported components. The instability in the Middle East has led to significant price hikes and unpredictable delivery schedules, making it increasingly difficult for these businesses to maintain adequate stock levels. This precarious situation threatens their ability to continue normal operations and fulfill existing orders.

Industry experts warn that if the geopolitical situation does not stabilize soon, many SMEs could face severe production halts. The current inventory levels suggest a limited buffer, and any further disruption could lead to immediate operational challenges. The Korean Federation of SMEs has highlighted these concerns, emphasizing the urgent need for measures to mitigate the impact on businesses.