China's Tour Ban Lifting Yet to Help Related Sectors: Sources | Be Korea-savvy

China’s Tour Ban Lifting Yet to Help Related Sectors: Sources

(image: KobizMedia/Korea Bizwire)

(image: KobizMedia/Korea Bizwire)

SEOUL, May 25 (Korea Bizwire)South Korea’s cosmetics and tourism industries have yet to benefit much from China’s lifting of a ban on group tours to Seoul despite a recent gain in the number of Chinese visitors, sources said Friday.

In March last year, China took a set of retaliatory measures against Seoul, including a ban on group tours, following the installation of an advanced U.S. missile defense system in southeastern South Korea.

In November, Seoul and Beijing agreed to put their bilateral ties back on track by lifting the ban and other sanctions, setting aside their bitter row over the installation of the Terminal High Altitude Area Defense (THAAD) battery.

According to the sources, the number of foreign tourists to South Korea came to 1.33 million in April, up nearly 24 percent from the same month a year earlier.

In particular, the number of Chinese tourists spiked about 79 percent on-year to 283,533, thanks to the lifting of the group tour ban.

The sharp increase in the number of Chinese tourists to South Korea helped domestic sales of cosmetics bounce back modestly from the previous slump.

LG Household & Health Care Ltd., which was not affected much by the THAAD row, said its cosmetics sales climbed 12.1 percent on-year to 907.7 billion won (US$841 million) in the first quarter of this year. Of the total, 338.3 billion won worth of cosmetics products were sold at duty-free shops.

A company official said sales of cosmetics are showing signs of recovery on the back of increased foreign tourists, but it is progressing at a moderate pace.

An official from industry leader AmorePacific Corp. chimed in.

“Despite the increased inflow of Chinese tourists, growth of sales at duty-free shops and other outlets is not so high. It remains to be seen whether cosmetics sales will recover to the level before the souring of bilateral relations,” the official said.

AmorePacific said it will instead ramp up efforts to tap into China, Southeast Asia, the United States and other overseas markets this year.

South Korea tourism companies also said they have yet to feel the positive impact of China’s lifting of the group tour ban.

Hana Tour, South Korea’s No. 1 travel agency, said it has posted dismal records for attracting in-bound Chinese tourists this year, despite a near 80 percent spike in the number of South Korean visitors to China.

“It is true that the tourism industry is showing signs of recovery, but it will take time to return to a normal level, let alone the boom period of 2015-16,” a Hana Tour official said.


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