SEOUL, March 22 (Korea Bizwire) – The operator of Incheon International Airport and small duty-free shop operators are at odds over rental fees for concessions at South Korea’s main gateway, industry sources said Thursday.
The small and medium-sized operators of duty-free stores at the airport’s Terminal 1 have recently demanded the Incheon International Airport Corp. cut their rent by 37.5 percent, far above the 27.9 percent cut offered by the airport operator, according to the sources.
The airport operator said the demand exceeds the actual drop in sales caused by the opening of the second terminal at the airport in January.
Still, the airport operator said it is willing to take part in further talks with the duty-free operators and asked them to provide “reasonable suggestions based on credible evidence.”
Earlier this month, the airport operator approved Lotte Duty Free’s request to end its money-losing concession deal at the airport after the two sides failed to reach an agreement over the rental fees.
Operators of duty-free stores have suffered declining sales in recent months due mainly to a plunge in the number of deep-pocketed Chinese tourists over a diplomatic row between Seoul and Beijing over the deployment of a U.S. anti-missile system in South Korea.
A total of 13.3 million foreigners visited South Korea in 2017, down 22.7 percent from a year earlier, according to government data. Among them, Chinese accounted for about 31 percent.
In 2016, 46 percent of 17 million foreign visitors to South Korea were Chinese.