July 30, 2018 12:26
Lotte will shut down its department stores in China after an unofficial boycott brought them to their knees, months after deciding to sell off its supermarkets there.
Lotte opened its first store in Beijing 10 years ago but has been unable to shoulder the snowballing costs of maintaining the Chinese stores.
It runs malls in five cities in China. Two in Tianjin and three in Weihai will be closed down completely, but the hotels, offices, theaters and theme parks in the malls in Shenyang and Chengdu will continue operating for now.
A Lotte staffer said, "The rental contracts for the stores up for closure have yet to expire, so we are considering selling them or paying the penalty."
At one stage, the Korean-Japanese conglomerate had hoped to expand the number of department stores in China to 20 by 2018. But it suffered an operating loss of around W140 billion in China in 2016 and 2017.
Meanwhile, Lotte hopes to wind up its supermarket business in China within the next two months. It started its supermarket chain in China in 2007 but suffered a W268.6 billion operating loss there last year.
Lotte has been hit hardest by China's unofficial boycott over Korea's deployment of a Terminal High-Altitude Area Defense battery. Lotte is known to have sold one of its golf courses to the Korean government which is now the THAAD site.
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