"Fuel Surcharges Up Over 50%"... Reports of Middle East War Damages to SMEs Surpass 700 Cases

Cumulative Reports of Damages Reach 733 Cases

The prolonged war between the United States, Israel, and Iran continues to expand the damage suffered by domestic small and medium-sized exporters.

According to the Ministry of SMEs and Startups on April 29, as of 12:00 p.m. that day, a total of 733 cases of damages, difficulties, and concerns related to the Middle East situation had been reported by small and medium-sized enterprises. This is an increase of 56 cases compared to the previous week. Since February 28, the ministry has been receiving online reports via its website and phone or in-person reports through 15 regional export support centers.

Of the cases received, 547 were classified as damages or difficulties, and 116 as concerns. In terms of type of damages or difficulties (multiple responses allowed), transportation disruptions accounted for the largest share, with 256 cases (46.8%). This was followed by increased logistics costs at 199 cases (36.4%), contract cancellations or postponements at 187 cases (34.2%), other issues at 172 cases (31.4%), business trip disruptions at 100 cases (18.3%), and unpaid payments at 87 cases (15.9%). Among the types of concerns (multiple responses allowed), transportation disruptions were also the most common, with 79 cases (68.1%), followed by other issues at 38 cases (32.8%), and loss of contact at 8 cases (6.9%).

By country, the highest number of reports came from countries in the Middle East other than Iran and Israel, such as the United Arab Emirates (UAE) and Saudi Arabia, with 432 cases. There were 93 cases reported from Iran and 87 from Israel. In addition, 188 cases of damage were reported from countries outside the Middle East.

One major case involved a small and medium-sized company that imports raw materials from Iran. The company’s procurement cost increased by 25 to 30 percent compared to previous levels, and the order placed in February has still not been delivered. The company has also not received any notice about the delay.

There are also companies unable to collect payments from buyers in the Middle East as usual. Due to restrictions on foreign exchange and financial systems in those countries, overseas remittances are delayed or effectively impossible. In another case, a company had planned to welcome buyers from the United States and India in April, but the visits were canceled due to the war. The company also reduced the number of staff sent on overseas business trips due to the burden of airline ticket costs.

This content was produced with the assistance of AI translation services.