Hit by fallout from the Korean government’s plan to deploy a US-made missile shield, the Lotte Group is shutting three retail shops near Beijing.
Korea’s fifth-largest conglomerate, Lotte was hit by a series of regulatory investigations into its China business in December after striking a deal with the Korean government a month earlier to relinquish one of its golf projects to accommodate the anti-missile system.
South Korean companies have discovered themselves in China’s crosshairs since Seoul’s determination in July to deploy the Terminal High Altitude Area Defence (THAAD) platform, reports News on Hand. Beijing opposes the move, fearing the US will use the platform’s radar to probe deep into Chinese territory.
Lotte says it has been restructuring its loss-making China enterprise for a few years, but the work has been spurred by the deteriorating bilateral relations because of the THAAD deployment. The retailer has already closed some of its unprofitable outlets in China.
Lotte has also been opening shops in China, but has put the brakes on this following officials conducting security, tax and other investigations. Having entered the market in 1994, the group has 99 stores and 16 Lotte Super shops in China.
Also in retaliation to THAAD, Beijing has blocked imports of high-tech bidets and a range of cosmetics, cancelled shows by Korean pop groups and restricted Chinese flights and tourism to Korea.