The recent Cambodia-Korea issue has spotlighted the vulnerabilities Korean small and medium-sized enterprises face when expanding abroad. As regional safety risks grow, the Ministry of SMEs and Startups (MSS) is reviewing ways to reinforce overseas business monitoring and crisis response to safeguard Korea’s expanding startup and SME ecosystem.

MSS Examines Cambodia Risk Exposure and Korean SME Safety Abroad

During the October 29, 2025, National Assembly’s Industry, Trade, and SMEs Committee audit, Minister Han Seong-sook of the Ministry of SMEs and Startups (MSS) confirmed that 85 Korean SMEs currently operate in Cambodia, where a series of crime-related incidents and travel bans have heightened business uncertainty.

Minister Han Seong-sook said,

“We have identified 85 active SMEs in Cambodia and are monitoring the situation closely. No official damage cases have been reported yet. However, we are actively monitoring the situation and will step up support measures to ensure the safety and stability of Korean enterprises operating overseas.”

The remarks came in response to lawmaker Kim Dong-ah’s inquiry regarding the government’s role amid mounting anxiety among firms and tour operators affected by the recent instability.

Cambodia, which ranks 30th among Korea’s export destinations, accounts for roughly KRW 500 billion (~USD 360 million) in annual exports — mainly cosmetics, textiles, and leather goods driven by SMEs.

Cambodia – Korea Issue Sparks Policy Reevaluation

The Cambodia-Korea issue refers to a series of serious criminal incidents in Cambodia — including online scams and abduction cases involving Korean nationals — which prompted Seoul to issue travel bans for specific regions.

While no SME damages have been formally recorded, the situation has disrupted export operations and travel-dependent businesses, exposing how geopolitical and local security risks can quickly affect overseas ventures.

Lawmakers emphasized that the incident should serve as a wake-up call for Korea’s SME risk management systems. Representative Kim urged MSS to move beyond data collection and establish a dedicated task force capable of assessing potential long-term impacts, saying:

“A simple status review is not enough. The government must analyze the full extent of possible damages and prepare contingency measures for prolonged disruptions.”

Government Response and Policy Direction

Minister Han said the ministry is reviewing structured approaches to overseas business monitoring and crisis response:

“We are compiling a comprehensive list of Korean SMEs operating worldwide and reviewing additional policy tools such as management stabilization funds and credit guarantees.
This incident underscores the need for a more systematic global support framework.”

Global Expansion Meets New Risk Realities

The Cambodia-Korea issue highlights a critical inflection point in Korea’s startup globalization strategy. As the nation pushes to help its deep-tech and export-driven startups scale globally, risk diversification and overseas protection policies have become central to sustaining long-term competitiveness.

Korean SMEs are increasingly entering emerging markets across Asia, where high growth potential can be offset by governance and security risks. This incident demonstrates the need for stronger cross-government coordination to improve early-warning systems and region-specific guidance for Korean businesses abroad.

MSS’ move to review the overseas business policy and monitoring signals that Korea’s startup ecosystem is shifting from rapid global expansion to resilient global operation — one capable of managing geopolitical, legal, and operational risks while maintaining growth momentum.

Building Safety Nets for SMEs and Startups Post Cambodia – Korea Issue

The MSS’s ongoing review following the Cambodia-Korea issue marks the beginning of a more strategic, risk-aware globalization era for Korean startups and SMEs.
By institutionalizing crisis management systems and expanding financial safeguards, the ministry aims to ensure that Korean innovation can thrive internationally without being derailed by unforeseen regional disruptions.

And eventually, it represents a crucial evolution: a recognition that sustainable globalization demands not only ambition but also protection.

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