An electronic board in Seoul shows the Korean won-dollar exchange rate rising to 1,426 on Dec. 9. (Yonhap)

Every year-end, the capital's popular tourist districts attract holiday crowds, with both locals and tourists drawn to the seasonal Christmas lights and year-end shopping.

This year, however, underlying spending patterns may tell a different story, in particular in the week following President Yoon Suk Yeol's short-lived declaration of martial law on Dec. 3 -- an unexpected event that has rattled both the nation's political realm and economic outlook.

"Usually at this hour, we'd be completely full," said a restaurant owner in her 50s, gazing across her nearly empty restaurant in Myeong-dong, central Seoul, around 6:30 p.m. “The martial law is to blame for the decline."

Park, a meat restaurant owner in his 40s near Gwanghwamun Station, described how multiple challenges have battered his business.

“The decline started with COVID-19 reducing social gatherings. Then inflation hit us hard as people cut back on spending. And now we're dealing with the martial law situation,” he said.

According to a Korea Franchise Union survey released Thursday, 88.4 percent of the 1,630 small business owners surveyed reported decreased sales following the martial law order. Of those surveyed, the highest percentage at 37.7 percent saw their sales plummet by more than half.

Certain businesses observed a decrease in custom from foreign tourists.

A clerk in his 40s, surnamed Jung, at a private currency exchange vendor in Myeong-dong mentioned that he had been serving far fewer customers than usual, a week after the martial law order.

“I believe that the martial law had a negative impact on the sentiment of foreign visitors,” he said.

The recent martial law crisis sent the Korean won tumbling to a two-year low of 1,442 against the US dollar on Dec. 4. As of Friday, the won remains weak, trading at 1,436 per dollar.

The distress was shared by 39-year-old Kim Ho-jin, who works in the same business. In addition to a decline in foreign patrons, he said, “There have rather been more Koreans who came to sell their dollars when the dollar strengthened.”

An official from Money Box, a nationwide currency exchange service provider, expressed greater concern about the future.

“The real issue lies with those who had planned trips to Korea,” he stated. “Online reservations for currency exchange services have already declined significantly compared to December last year.”

On the other hand, not all shared the grim outlook for the Korean economy, such as Kim Eun-ja, a woman in her 50s and the owner of a Korean cosmetics shop in Myeong-dong.

"I just served a group of Thai customers. The neighborhood's business activity hasn't changed because of the martial law,” she said.

Amid mixed reactions to the overall economic atmosphere, it remains to be seen how long the ramifications of political instability will weigh on the local economy.

An official from the Korea Federation of Micro Enterprises urged the government to implement financial and regulatory support measures for small business owners struggling due to high inflation and political uncertainties in the nation.

“Regardless of the outcome of the impeachment proceedings, a swift resolution to this situation is crucial,” the official remarked.