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Shinsegae shares plunge on vice chief’s anti-communist remarks

Shinsegae Group Vice Chairman Chung Yong-jin (Shinsegae Group)
Shinsegae Group Vice Chairman Chung Yong-jin (Shinsegae Group)
Retail giant Shinsegae Group saw its shares plunge on Monday as a controversial social media post from the group’s heir and Vice Chairman Chung Yong-jin sparked investor jitters.

The company’s stocks shed 6.8 percent to close at 233,000 won ($196.23) Monday against the benchmark KOSPI’s 0.95 percent decline.

The plunge in stock value comes after Chung made several politically charged remarks in recent months criticizing communism alongside pictures of Chinese President Xi Jinping and North Korean leader Kim Jong-un.

In the latest of such posts, Chung slammed Instagram for taking down one of his posts with the hashtag “annihilate communism” which was later restored by the platform.

It is not often that owner families of South Korean conglomerates would comment on politics so openly on social media.

The group owns department stores, supermarket chain E-Mart and operates Starbucks in the country. Though E-Mart withdrew its business from China in 2017, Shinsegae International’s cosmetics brand ‘Vidivici’ has enjoyed popularity in China.

His remarks spark investor fears of a negative impact on the group’s business in China.

In 2017, Lotte Mart was forced to close its operation in China after being targeted over the South Korean government’s decision to deploy a US anti-missile system.

Chung has enjoyed a growing online following from those who love his outspoken social media presence in recent years. Some conservative politicians including the presidential candidate of the main opposition party Yoon Suk-yeol have indirectly thrown their support behind Chung by visiting E-Mart.

Critics, however, have accused the billionaire of playing with the economy.

“Has he been jealous of Elon Musk impacting the crypto market with his tweets?” said Kim Tae-nyeon, a member of the ruling Democratic Party of Korea, on Facebook.

“His remarks could have a major impact on South Korean companies and workers doing business in China.“

By Yim Hyun-su (hyunsu@heraldcorp.com)
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