July sales at duty-free stores rise despite THAAD spat

SEOUL-- Sales of South Korean duty-free stores improved in July, industry data showed Thursday, despite a sharp drop in the number of foreign tourists following a diplomatic row between Seoul and Beijing over the deployment of a U.S. missile defense system here.

The sales to foreigners at local duty-free shops came to US$693 million last month, up 8.8 percent from $637 million tallied a year earlier, according to the data compiled by the Korea Duty Free Shops Association.

The tally for June also jumped 10.2 percent from $624 million a year earlier to $688 million.

The number of foreign visitors to local duty-free shops, meanwhile, plunged 44.7 percent from 1.91 million in July 2016 to 1.05 million last month.

The drop in the number of visitors is largely due to Beijing's ban on selling package tours to South Korea in an apparent retaliation over the deployment of a Terminal High Altitude Area Defense (THAAD) battery here.

Last month, the number of Chinese visitors declined nearly 70 percent, marking a drop for five straight months. Chinese visitors accounted for nearly half of some 17 million foreigners in the country last year.

Local duty-free stores say the latest increase in sales is attributable to large discounts and marketing efforts, adding it will take some more time for their business to fully recover.

Hotel Lotte's duty-free unit, operator of the country's top Lotte Duty Free, logged an operating income of 7.4 billion won ($6.5 million) in the January-June period, a sharp fall from the operating income of 233 billion won a year earlier, according to its semi-annual business report.

Source: Yonhap News Agency

You may also like...