Sales of South Korean duty-free stores have fallen for three consecutive months since April, industry data showed, partly due to the Chinese government’s strengthened crackdown on Chinese shuttle traders or “daigongs.”
According to the Korea Duty Free Association, combined sales at 48 local duty-free shops came to $1.41 billion (1.6 trillion won) in June, an about 5.17 percent drop from the previous month.
Despite a sharp decrease in the number of foreign tourists following a diplomatic row between Seoul and Beijing over a US anti-missile system last year, sales at duty-free stores reached an all-time high in March with $1.56 billion.
According to government data, the number of foreign visitors from January to November last year declined 49.1 percent on-year.
In 2016, Chinese visitors accounted for nearly half of the 17 million foreigners who visited South Korea.
Industry insiders said along with low tourist arrivals from China, the Chinese government’s crackdown on small-scale Chinese traders who used to drive duty-free sales growth here is also impacting duty-free sales in Korea.
Although the number of foreign tourists increased by 15,000 in June compared to May, sales went down to $1.11 billion from $1.16 billion.