By: Deanna Park

Recently, South Korea and the United States have decided to deploy an advanced missile defense system, also known as the Terminal High Altitude Area Defense (THAAD) anti missile system, on the Korean Peninsula to counter North Korean threats. THAAD is to be used as protection against the Democratic People’s Republic of Korea (DPRK) and its growing Intercontinental Ballistic Missile (ICBM) capabilities.

Following the election of US President Donald Trump, the US has taken an increasingly militarily inclined agenda in dealing with North Korea. Trump and his administration called the deployment an important decision to bolster defense efforts and also criticized President Moon Jae-In of South Korea for seeking “appeasement” with Pyongyang.

The US’s changed tone in dealing with North Korea has elicited far from positive reactions from China. Shortly after the announcement of the deployment, China’s Foreign Ministry released its own statement, saying that the decision would change the strategic balance in the region and undermine China’s security and interests. China is particularly concerned about THAAD in South Korea, because the system would give the US military the ability to quickly detect and track missiles launched in China as well. Chinese President Xi Jinping urged Trump to resolve the crisis through dialogue and expressed concern about the ongoing situation.

But Beijing’s disapproval of the deployment was felt strongest in its actions against Seoul. The government-controlled news media has urged boycotts of South Korean products. South Korean bands have been denied visas to perform in China, and South Korean shows have disappeared from Chinese television and streaming services. The Chinese news media has also played a central role in fueling protests. An opinion piece by Xinhua, the official news agency, suggested that the South Korean conglomerate Lotte was an accomplice in an effort to undermine China and that it was no longer welcome in the country.

Among those hit the hardest is the Korean tourism industry. As China orders mainland travel agencies to cancel group trips to South Korea, bans selling package tours to Korea and announces unofficial sanctions against South Korea, the Korea Tourism Organization (KTO) has predicted there could be a drop of 4.7 million or 27% in Chinese tourists this year. Chinese visitors made up 46.8% of tourists in South Korea last year. The numbers have declined every month since March but particularly devastating in May when arrivals dropped to below a million for the first time since the MERS epidemic in 2015. KTO officials predicted that if the current trend continued, the South Korean tourism industry could enter a long-term depression. Chinese tourists are also big spenders and duty free stores, such as that of Lotte, have taken a hit as sales have plunged 40% from a year earlier. Chinese tourists account for as much as 80% of duty free sales in South Korea. In the last decade, China’s burgeoning middle class had increased its spending on outbound travel with the Chinese spending $261 billion traveling abroad in 2016, an increase of 12% from the previous year. This phenomenon had rendered many South Korean businesses particularly reliant on Chinese tourists and hit hard by the sudden drop of business.

This year is the 25th anniversary of the establishment of formal ties between China and South Korea. But in a sign of the tensions between the two countries, there is no plan in place yet to celebrate the occasion. However, analysts have said that the protests might be short-lived and such initiatives could die down quickly as many Chinese people are already finding it difficult to uphold a boycott, given the preponderance of popular Korean goods in Chinese stores.

Works Cited

1. Griffiths, J. (2017, September 07). South Korea expects North to launch ICBM on Saturday, prime minister says. Retrieved October 17, 2017, from http://www.cnn.com/2017/09/07/asia/south-korea-thaad-north-korea/index.html
2. Javier C. HernÁndez, Owen Guo And Ryan Mcmorrow. (2017, March 09). South Korean Stores Feel China’s Wrath as U.S. Missile System Is Deployed. Retrieved October 17, 2017, from https://www.nytimes.com/2017/03/09/world/asia/china-lotte-thaad-south-korea.html
3. Mullany, G. (2017, May 12). Chinese Rappers Take Aim at American Antimissile System in South Korea. Retrieved October 17, 2017, from https://www.nytimes.com/2017/05/12/world/asia/china-south-korea-thaad-rap-video.html?_r=0
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6. South Korean businesses have been suffering since early this year after the country angered the Chinese government with the deployment of a U.S. missile defense system. (n.d.). China can squeeze its neighbors when it wants. Ask South Korea. Retrieved October 17, 2017, from http://money.cnn.com/2017/08/30/news/economy/china-hyundai-south-korea-thaad/index.html