Significantly fewer Chinese tourists are visiting Korea since a new travel law took effect in China this month, leaving travel and retail businesses here that counted on a continuing boom high and dry.
Korea's biggest travel agency Hana Tour on Thursday said the number of Chinese tourists it handled shrank to 4,000 in October, down 60 percent from 10,000 last month.
Mode Tour said its tours attracted 13,000 Chinese last month, but that fell to 5,000 in October. The numbers include all bookings until the end of this month.
"The decline is mainly due to the new Chinese travel law," said a Mode Tour staffer.
The new travel law bans including shopping in tour programs, charging extra, and demanding tips. It aims to prevent travel agencies from attracting customers with cut-price tours that sometimes fall short of even the round-trip airfare, and then trying to make the money back from tips, optional extras and herding them into certain shopping outlets that pay commissions.
That sent the average cost of a package tour to Korea up 30 to 40 percent.
"As most group tours to Korea were cut-price packages, it seems they suffered directly from the new travel law. Demand for travel to Europe or the U.S. has stayed about the same," said a Korean resident in Shanghai.
Although a lot of Chinese tourists came here during China's national holiday week, which ended Oct. 7, the number for the month is now less than half that of September.
"There have been almost no Chinese customers since the national holiday," said a travel agent. "It feels even more serious because we had so many Chinese customers until September."
Department stores and duty-free shops are worried since booming sales to Chinese tourists had made up a welcome buffer in this recession.
A department store spokesperson said, "Business is expected to suffer a considerable drop if the number of Chinese tourists plummets. We’ll have to think of a new promotional strategy."