Chinese travel law may hamper S. Korean tourist industry
SEOUL, Sept. 24 (Yonhap) --- A new Chinese law that bans travel agencies from selling abnormally low-cost overseas shopping tours may have a slight impact on the South Korean tourism market in the short term, but will improve market conditions in the long term, market watchers said Tuesday.
Chinese tourists have been traveling to South Korea at an abnormally low cost in return for shopping at stores that cater directly to them, introduced by South Korean travel agencies associated with Chinese travel agencies. South Korean travel agencies have often lowered the cost of their programs for Chinese tourist groups by receiving money from the shops.
Local watchers said that the implementation of the law would push up the cost of travel programs for Chinese tourists by about 30 percent, leading to a short-term fall in the number of Chinese tourists to South Korea but contributing to the normalization of local tourism markets by removing abnormally low-cost travel goods.
"The law implementation will have only a slight impact on the local tourism industry in the short term as the market share held by the local travel agencies arranging shopping trips for Chinese tourist groups is small," said Ryu Han-sun, the head of the Chinese team of the state-run Korea Tourism Organization (KTO).
However, the ban may lead to a slowdown in the growing number of Chinese tourists visiting South Korea due to the increased cost of travel programs, he said.
According to the data by the KTO, the number of Chinese tourists was up 78.9 percent to 642,300 in August from 359,065 a year ago. The figure takes up 47.3 percent of the total number of foreign tourists, extending a rising streak to three months.
The sharp rise in the number of Chinese tourists to South Korea stemmed from anti-Japanese sentiment in China sparked by the dispute over islands in the East China Sea early this year, analysts said.
Ryu also said large-sized local retailers like Lotte Department Store will not be affected by the law implementation, as they have not been attracting Chinese tourist groups by giving rebates to travel agencies. Small-sized retailers only for Chinese tourists, however, will be seriously affected.
Jung Seon-hwa, a spokesperson for Lotte Department Store, was not worried about the ban. "We predict that the law will not have an impact on our sales as we did not offer rebates to travel agencies in exchange for attracting Chinese tourists," she said.
She also said Chinese tourists spontaneously visited the department stores to buy high-quality goods.
In addition, Oh Seung-hwan, a spokesman for Hana Tour Service Inc., the country's biggest travel company, is optimistic about the ban in the long-term.
"Travel demands for South Korea will likely fall in the short term due to the law implementation, but it will have a positive impact on the local tourism market by improving the market order," said Oh.
The KTO expects that the number of Chinese tourists visiting South Korea will reach 150,000 during China's National Day, which falls on Oct. 1-7 this year, up 60 percent from a year ago.
Chinese travelers usually flock to South Korea during China's three major holidays -- Lunar New Year's Day, Labor Day in May and National Day in October.
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