Credit card spending by Chinese tourists focuses on cosmetics: survey

By Park Sae-jin Posted : September 8, 2016, 11:19 Updated : September 8, 2016, 11:21

Chinese group tourists are entering duty duty-free shop in Centum City Shopping Mall located in the southern port city of Busan. [Yonhap Photo]

Spending by Chinese tourists using plastic cards has jumped dramatically over the past five years, helped by the growing popularity of cosmetics products favored by young people, industrial data showed Thursday.

Credit card spending by Chinese tourists stood at 4.33 trillion won (3.97 billion US dollars) in the first half of this year, compared to 786 billion won in 2012, according to a joint survey conducted by the Korea Culture and Tourism Institute and Shinhan Card research center.

The survey found that shopping accounted for 56.2 percent of this year's first-half credit card spending by Chinese tourists during their trips to South Korea. Perfume and cosmetics products at duty-free shops were favored most especially by young Chinese shoppers.

Of total first-half credit card spending by foreign tourists, 68 percent came from the Chinese, compared to 28 percent in 2012.

South Korea received 14.2 million foreign tourists including 6.1 million Chinese in 2014. But the number of foreign tourists dwindled to 13.23 million including 5.98 million Chinese last year.

Big-spending Chinese tourists have rushed in again this year after hanging a leg for fear of the highly contagious disease.

In the first seven months of this year, 98.1 million foreign tourists arrived in South Korea, up 34.3 percent from a year ago, according to the state-run Korea Tourism Organization. During the same period, South Korea received 47.3 million Chinese tourists, up 45.4 percent.

Data from the Korea Customs Service (KCS) showed total sales at South Korean duty-free stores surged from 5.3 trillion won in 2011 to 9.19 trillion won in 2015.

Chinese group tourists inspect merchandises displayed in Centum City Shopping Mall's duty duty-free shop located in the southern port city of Busan.[Yonhap Photo]

The duty-free business is expected to be worth up to 10 trillion won this year, up 8.7 percent from 2015, KCS said in an earlier report.

South Korea has nine duty-free shop operators in operation and plans to open six more. KCS will accept bids for duty-free operation rights by October 4. Three large and one small candidates will be chosen by the end of the year.

All duty-free shops must apply for government permits every five years. Last year large industrial groups were allowed new permits for the first time in 15 years. Lotte and SK Networks, however, were unable to renew contracts while Hyundai Department Store failed to make entry.

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