South Korean President Yoon Suk Yeol stunned voters, lawmakers and investors by declaring martial law on Tuesday after accusing the opposition of trying to paralyze his administration amid a political rift that is set to deepen markedly.

In an emergency national address televised live, Yoon said he made the decision to protect freedom and constitutional order, and that it will not have an impact on South Korea’s foreign policy. He added that it would also help eradicate the influence of North Korean supporters.

“Through the declaration of martial law, I will rebuild and protect a free South Korea,” Yoon said. A proclamation released after the address banned all political activities and strikes and said media would be subject to control of the Martial Law Command, according to Yonhap News.

The move was initially viewed as a risky political play that is likely to backfire rather than an attempt to return to military-led regimes of the past.

South Korea’s National Assembly Speaker Woo Won-shik called on lawmakers to go the national assembly immediately. In the 300-seat parliament, 190 lawmakers unanimously voted to demand the lifting of the martial law. “I urge the public to trust the parliament and monitor the situation with calm,” Woo said in a statement.

The won tumbled to 1,444.65 — its lowest level in over two years — while London-listed shares of Samsung Electronics fell as much as 5.5%. The Korea Exchange said it’s reviewing whether trading will resume as usual on Wednesday.

The shock announcement to impose martial law for the first time since the democratization of South Korea in 1987 left even Yoon’s own party blindsided with its leader vowing to stop the move. Yoon’s abrupt decision comes after months of wrangling and deadlock in parliament between the president’s minority government and the main opposition Democratic Party.

The DP is currently trying to force through its own budget proposal through parliament and has submitted an impeachment motion against the chief prosecutor after months of also trying to get Yoon’s wife prosecuted. Meanwhile, the DP’s leader has faced multiple court cases and was convicted last month of election-law violations.

Yoon has dealt with the deadlock in a largely standoffish manner, vetoing a string of bills passed by parliament and at times angering his own party. His latest act ramps up tensions considerably both domestically, while also creating high uncertainty abroad for the outlook of one of the world’s key suppliers of semiconductors and tech-related gear.

“Yoon’s declaration of emergency martial law is highly concerning. It marks a stark shift in the administration’s policy,” said Kayla Orta, senior associate at the Hyundai Motor-Korea Foundation Center for Korean History and Public Policy in Washington DC. “Instead of solidifying his political position, this could further damage his domestic standing.”

South Korea’s defense minister ordered a meeting with the military’s top commanders and the finance minister also called an emergency meeting, according to Yonhap.

South Korean broadcaster YTN showed police restricting entry to the parliament compound as people gathered neared the gate. Aides of lawmakers used fire extinguisher to block soldiers from entering the building.

Under the country’s constitution, the president has to comply if the parliament requests the lifting of martial law with the concurrent vote of a majority of the total members.

“The president’s declaration of martial law is wrong,” Han Dong-hoon, head of Yoon’s People Power Party, said in a Facebook post. “I will stop this with people.”

“Seems like an extreme use of the martial law, with the headline coming out of nowhere,” said Olga Yangol, the head of emerging markets research and strategy at Credit Agricole. “It is not clear what this means in practice.”

The move comes at a time of high uncertainty for the nation as its trade-dependent economy faces potential tariffs from President-elect Donald Trump’s incoming administration. Bloomberg Economics estimates that full imposition of tariffs on China, South Korea and other U.S. trading partners could reduce Seoul’s exports to the U.S. by as much as 55%.

Meanwhile, North Korea continues to deepen its ties with Russia, having sent thousands of troops there to help in Moscow’s war against Ukraine. Russia’s defense minister visited Pyongyang last week in the latest sign of talks between the two countries. Russia may help provide North Korea key technology for its weapons programs including its intercontinental ballistic missiles.

The administration is in contact with the South Korean government and is monitoring the situation closely, a U.S. official told Bloomberg.

China suggested its citizens residing in South Korea keep calm and try to avoid going outdoors for anything non-essential, the country’s embassy said in a post on social media Tuesday night. The embassy also asked Chinese citizens to comply with official orders from the Korean government and “use caution” over sharing political opinions.

“The domestic uncertainty adds to the external pressures in recent weeks as the market is starting to price in the rise of higher U.S. tariffs under the new Trump administration,” said Aroop Chatterjee, a strategist at Wells Fargo. “Korea is an open economy sensitive to shifts in global export demand and and spillovers from a weaker China.”

It is unclear what impact the martial law will have on South Korea’s biggest chipmakers. Nvidia depends mostly on SK Hynix for so-called high-bandwidth memory chips required for its most cutting-edge semiconductors, and whether the South Korean chip firm can continue to supply those high-end memory chips may affect the global AI development.

“South Korean leadership has used this in the past during times of significant political unrest or transitions of power but it is concerning none-the-less,” said Brad Bechtel, global head of FX at Jefferies. He sees the won staying volatile for the time being. “A lot will depend upon the reaction of offshore investors in the local equities markets. If they start selling aggressively then we could get to 1450.”

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With assistance from Daedo Kim, Yoolim Lee, Kerim Karakaya, Anya Andrianova and Heejin Kim.

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