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The Korea Herald
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THE INVESTOR
March 29, 2024

Retail & Consumer

Lotte’s Chinese operations in jeopardy over THAAD

  • PUBLISHED :March 07, 2017 - 13:55
  • UPDATED :March 07, 2017 - 13:55
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[THE INVESTOR] Lotte Group is being pushed to an increasingly precarious position in China, prompting some to project that withdrawing from the country may be the best option.

The group first entered China in 1994, and has invested over 10 trillion won (US$8.70 billion) with 22 Lotte subsidiaries currently operating there. 


A Lotte Mart outlet in Beijing



However, the group’s decision to provide land for deploying US’s Terminal High Altitude Area Defense anti-missile system in South Korea has put it in a spot.

So far, the operations of nearly a quarter of the 99 Lotte Mart stores have been suspended for various reasons. A Lotte Super retails store has also been fined about 83 million won for violating pricing regulations, and three Lotte Super stores have been ordered to pay 350 million won compensation to suppliers who claimed that the stores’ closures have caused damages.

In addition, the group’s Chinese website has come under cyberattacks and anti-Lotte sentiment is said to be spreading in China.

Flaring anti-Korean sentiment directed at Lotte coupled with the group’s lackluster performance in China has prompted Korean news reports citing unnamed sources that the group may pull out of China.

Last year, the overseas operations of Lotte Department Store and Lotte Mart recorded operating loss of 83 billion won and 124 billion won, respectively, up to 90 percent of which is thought to have been incurred in China.

By Choi He-suk (cheesuk@heraldcorp.com)

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