South Korean financial markets took a sharp hit on 9 October 2006 after North Korea announced it had conducted a nuclear test. The benchmark KOSPI index dropped more than 2.4 percent before partially recovering, while the won fell roughly 1.6 percent against the dollar, closing near 964 won per dollar.
Prime Minister Han Myeong-Sook called an emergency meeting of senior economic officials to evaluate the fallout on South Korea, the world's 11th largest economy. Business organizations warned the test represented a serious economic threat, raising concerns about capital flight and damage to the country's international credit standing.
Several market analysts cautioned that prolonged tensions could deter foreign investment and delay any financial recovery. One researcher at Samsung Economic Research Institute offered a more measured view, predicting that markets would eventually stabilize over the longer term.
President Roh Moo-Hyun acknowledged that sustaining Seoul's engagement policy toward Pyongyang would now be difficult. Hyundai Asan, which operates a tourist program at Mount Kumgang and co-develops an industrial zone in Kaesong, said it had no immediate plans to halt operations, though visitor numbers at Mount Kumgang had already fallen 22.5 percent in September following North Korea's missile tests in July.
Historical summary. TurkishPress restated this wire report, first published in October 2006, in its own words.