South Korea’s GDP Drops as Spat With China Over THAAD Dampens Tourism, Exports

South Korea’s GDP Drops as Spat With China Over THAAD Dampens Tourism, Exports

Xu Wei

Date: Wed, 12/13/2017 - 20:37 / source:Yicai
South Korea’s GDP Drops as Spat With China Over THAAD Dampens Tourism, Exports
South Korea’s GDP Drops as Spat With China Over THAAD Dampens Tourism, Exports

(Yicai Global) Dec. 13 -- A spat with China over an anti-ballistic missile defense system caused South Korea’s real gross domestic product to take a hit this year, Yonhap News Agency reported.

The volume of Korean-bound Chinese tourists for the year will likely halve compared with last year, dropping 4 million, per data the Bank of Korea released today. This will decrease South Korea’s real GDP for the year by USD5.2 billion, as Chinese tourists add USD1,300 in value per capita.

The number of Chinese citizens entering South Korea from March to October fell 3.6 million to 2.4 million. The year-on-year decline recorded in those eight months ranged from 40.0 percent to 69.3 percent.

Purchases of Korean exports also slipped after China began its anti-THAAD campaign and this will affect Korea’s GDP, the Bank of Korea said.

The relationship between South Korea and China has shown signs of improving, meaning the Korean economy may pick up.

The two countries published the results of bilateral talks on Oct. 31, stating that they would reach a consensus on the early reopening of exchanges and cooperation in various fields. The Beijing Municipal Commission of Tourism Development and Shandong Provincial Tourism Administration allowed travel agencies to resume sales of South Korean group tour products last month.

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Keywords: South Korea, Bank of Korea, TOURISM