The Shilla Duty Free (Shilla) has inked a strategic partnership agreement with Incheon International Airport Corporation (IIAC) to open a new duty free shopping operation at Hang Nadim International Airport (BTM) in Batam, Indonesia.

Shilla will begin its business at the airport, which is located in the tourist destination of Batam in the Riau Islands, as early as the first half of next year.

Batam Airport will be the South Korean travel retailer’s fourth overseas location, building on its exciting concessions footprint at Singapore Changi Airport, Hong Kong International Airport and Macau International Airport.

As the only duty free shop operator at Batam Airport, Shilla will exclusively supply major goods such as alcohol, perfumes & cosmetics and tobacco.

“With regard to the new agreement in Indonesia, we are currently preparing for the opening and planning to open next year,” said a Shilla spokesperson.

An official signing ceremony was held this week at Batam Airport, with 11 officials in attendance including those from IIAC, Shilla and PT.BIB, a special local purpose corporation.

Shilla entry expects to spark investment in Batam

“With the signing of this agreement, the corporation expects that once the Shilla Duty Free Shop begins operating at Batam Airport, it will greatly contribute to revitalising the domestic economy, including creating new jobs and generating foreign currency profits,” read a statement.

“In addition, the corporation expects that the opening of the Shilla Duty Free Shop will serve as a catalyst for the advancement of domestic companies into Batam Airport in the future.”

Lee Hak-jae, President of IIAC, added: “In the future, in the process of promoting new overseas business, including the operation of Batam Airport, we will actively promote the national economy by expanding joint ventures with excellent domestic companies and exporting the ‘Korean-style airport platform (K-Airport)’ as a whole.”

IIAC signed a 25-year agreement with the Batam Indonesia Free Zone Authority in December 2021 to oversee Batam Airport’s operations and maintenance.

The large-scale development is South Korea’s first overseas airport operation and construction project.

Shilla ranked in third place in the TRBusiness Top 10 International Operators report with sales of approximately KRW5.95 trillion/US4.76 billion (including 100% of the HDC-Shilla Duty Free JV’s contribution, plus revenue from overseas operations such as the 44% shareholding it holds in 3Sixty Duty Free).

Click here for more on Shilla’s 2022 performance via an interview with Executive Vice President/Sales HQ Younghoon Kim.

Images source: IIAC.