The inauguration of President Moon Jae-in in South Korea has raised hopes for thawing relations between Seoul and Beijing, but businesses say that it may take some time before sales rebound.

In March, the Chinese government began taking unofficial measures against Korean businesses serving Chinese customers and tourists. These actions were interpreted as retaliation for the Korean government’s decision to install an American anti-missile system here.

The most significant was a blanket travel ban that prevented local travel agencies from offering group travel packages to Korea -- which struck a massive blow to sales at duty-free shops here.

However, there were also other measures taken, including widespread safety protocol inspections at Lotte Mart branches operating in China that led to almost all of the chain’s 99 branches closing down.

Major airlines including Korean Air and Asiana Airlines were also led to significantly reduce their services for China-bound flights as reservations plummeted following the Chinese measures.

Now, following the entrance of a new administration and a recent meeting with Chinese leadership by Korea’s special envoy Lee Hae-chan, there may be light at the end of the tunnel, industry watchers say.

“It is much too early to determine whether sales will come back up to pre-March levels, but the recent events definitely signal a change in the way the Chinese government is viewing Korea,” an official with a duty-free operator said.

The Chinese government seems to be softening its rhetoric as well. At a press briefing on May 19, Chinese Foreign Ministry spokesperson Hua Chunying commented on President Xi Jinping’s meeting with Lee Hae-chan, saying that “President Xi said that China values its relationship with the ROK (Republic of Korea) and would like to work with the ROK to preserve the hard-won outcomes of bilateral ties,” a contrast from previous statements that focused on the need for Korean business to respect Chinese rules and regulations.

Reports coming from China have also noted the re-emergence of billboards featuring Korean celebrities as well as resumed services for streaming K-pop music on Chinese platforms, showing that the Chinese government has allowed such content to come back into distribution.

With these positive signs, the Korea Tourism Organization as well as regional governments are planning to hold familiarization tours for Chinese organizations to prepare for possible group tours in the future.

Still, businesses say that they have yet to see any concrete changes in sales.

“We are all optimistic, but unless the Chinese government lifts the travel ban there is not much to look forward to,” said an official with a retailer that operates department stores and shopping malls in Korea. “Even if individual travelers continue to rise, sales from those shoppers come nowhere near the numbers we used to see with group tours.”

“We will be operating our Chinese routes at about 85 percent of last year’s capacity, and will make further changes according to developments,” said a spokesperson for Korean Air. Asiana Airlines is also making plans to bring back large aircraft to its Chinese routes in July, subject to change. 

By Won Ho-jung (hjwon@heraldcorp.com)