SEOUL, April 25 (Korea Bizwire) – The government said Tuesday it plans to extend some 226 billion won (US$119.3 million) in loans to local tourism businesses hit by a sharp drop in Chinese visitors in the wake of Beijing’s hostile policy toward its neighbor.
Tourism-related businesses here, such as travel and hospitality, are taking the brunt of China’s ban on trip sales to Korea, which took effect from March 15, in apparent retribution for Seoul’s planned installation of a U.S. anti-missile system called Terminal High Altitude Area Defense (THAAD) on the Korean Peninsula.
China has slammed the deployment of the powerful U.S. defense battery, saying it will undermine its security interest.
The ban on selling tours has slashed Korea’s Chinese tourist tally by 40 percent in March from a year earlier, with the figure likely to drop further in the months ahead, the Korea Tourism Organization (KTO) said on Monday, a major blow to Asia’s fourth-largest economy where Chinese visitors account for about half of inbound foreigners.
In an effort to help ailing businesses tide over the fallout, the Ministry of Culture, Sports and Tourism will provide some 438 firms with special loans that come at a lower rate through the state-run Korea Development Bank and most major lenders here, the ministry said in a release.
The selected firms mainly include small and medium-sized travel agencies, hotels, restaurants and duty-free shops, it said.