South Korean travel retailers have reacted with caution following news China is set to lift economic restrictions on South Korean companies in place because of the THAAD missile issue.

According to local media reports, which have been verified by TRBusiness, Chinese State Counsellor Yang Jiechi said there would be “tangible results in the near future.”

This was during a meeting last Friday (30 March) with South Korean President Moon Jae-In who requested China ends what is viewed as retaliation for the deployment of THAAD in Korea.

As extensively reported, these so called retaliatory methods have included a ban on Chinese group tours to South Korea, which has severely impacted the South Korean DF&TR Industry.

POSITIVE DEVELOPMENT

A Shilla spokesman told TRBusiness: “Generally the news itself is good and creates a sense of hope, but it is rather difficult to expect an instant return of Chinese travellers.

“It may take another quarter or semester to witness an actual increase in the number of Chinese travellers in South Korea.”

According to latest Korea Tourism Organisation figures, Chinese arrivals to Korea in February 2018 dropped -41.5% to 345,341 compared to the same month in 2017.

While this represents an improvement from the months of April to July 2017, for example, when the decreases were between -64.1% and -69.3% the spokesperson is clearly refusing to get carried away.

“The recovery of the Chinese inbound market needs more time even once the economic restrictions are actually lifted.

“The impact will be realised gradually. We need to observe the changing climates in mainland China to see what we call ‘real and meaningful change’ and one we have evidence of these changes we can think about being optimistic.”

Pressed by TRBusiness on how the retailer thinks things will actually pan out, the spokesman added: “I am unsure. Shilla anticipates many things but only a few will actually transpire .

“Firstly, we must see if Chinese overseas travel agencies resume marketing South Korean travel packages.

“There are also other variables to consider such as the flight schedules of Chinese carriers and marketing allowance in mainland China.”

When asked if there had been any progress since the summit meeting last November between Korean President Moon Jae-in and Chinese president Xi Jinping in Vietnam the spokesman added: “It’s too early to evaluate the impact of the meeting. Actual change takes time.

“We must look for tangible changes in numbers [of arriving Chinese passengers]. That said, we are expecting things to improve in the future.”

LOTTE REACTION

Meanwhile, rival Lotte Duty Free is adopting a similar stance. A spokesman told TRBusiness: “From our perspective, it is welcome news, but we must wait and see if the backlash is actually lifted.

“There may be extra conditions to be added so we will not be too optimistic just yet.”

Contrary to Korea Tourism Organisation figures which do at least suggest the slump in arrival of Chinese consumers to Korea might be easing, the spokesman has not seen an improvement. “We cannot say for sure about the relationship on an international level, but as a business operator in a tourism industry there is no clear sign of improvement.

“The group tours are still banned, meaning the group tour packages are not being sold and flights are not being chartered to prepare for them.”

Looking ahead, it is hard to predict what will happen, but the spokesman added: “We just hope to see ‘tangible results’ soon which will normalise the industry.”