The won's freefall against the dollar is taking a toll on the nation's real economy, as industries and individuals are suffering difficulties caused by the drastic decline in the local currency's value.

The won rebounded yesterday (October 9) to 1,379.5 won per dollar. The local currency has fallen more than 32 per cent so far this year.

Industries like tourism and manufacturing, as well as people engaged in frequent overseas transfers are bracing for growing hardships.

South Korea's outbound tourism industry and airliners are on edge as the weakening won will reduce their sales and profits. At Korean Air, for instance, a 10-won increase in the exchange rate would result in an annual sales loss of 20 billion won (US$14.3 million). Asiana Airlines would face a drop of some 7.5 billion won.

A Korean Air official said that the airline is taking the effect of the falling won much more serious than the recent oil crisis. "Our price was set when the exchange rate was 930 won against a dollar.

"Now that the exchange rate has jumped up almost 50 per cent, we have made changes in some of the routes that are less popular among customers," the official said.

An official of a tour agency said that the industry endured the financial crisis and SARS turmoil but operating the company has never been harder.

"We don't know what to expect since the exchange rate keeps rocking. We would be ok with the high exchange rate if it at least maintained stability," he said.

"When we were planning a tour item to Los Angeles a few months ago, nobody thought the exchange rate will exceed 1,200 won. I don't know how many companies can take it if the rate goes over 1,500 won," he said.

Hana Tour, one of the major tour companies in Korea, recorded a loss of some 3.3 billion won in September alone.

"There's too much of a loss from the exchange rate. We are charging an extra 50,000 to 100,000 won to honeymooners to Bali and some 200,000 won to those to the Maldives from mid-October to the end of November. This surcharge will be applied to other areas as well," a company official said.

Hwang Ho-san, whose son is studying in South Africa, said that many parents like him are in limbo. He said he used to send an average 2 million won a month for his son's tuition and living cost. This month, he is transferring some 4 million won.

"I used to wait for another week to transfer the money but I think the situation won't get better anytime soon," he said.

Korean expatriates are not immune from the shooting won/dollar exchange rate's effects. Some companies are delaying overseas transfers of salary and living subsidy. Those who were lucky enough to get paid are also left with what is half of the usual salary.

An official at a US-based Korean company was quoted as saying by a local newspaper, "There's a big difference between 980 won per dollar and 1,300 won per dollar. I can't help but think that my balance will be smaller next time I get paid."