China’s state media are calling for a boycott of South Korean goods and sanctions after a Korean conglomerate approved a land swap deal at home that paves the way for the deployment of a controversial U.S. missile defense system. But how China could go about punishing South Korea without hurting its own economy is already proving to be a difficult question, and not all agree boycotts are a viable solution.
In the wake of an agreement between the Lotte Group and South Korea’s Defense Ministry, Chinese state media have been appealing to the public to respond to the deal, calling for consumers to boycott not only its stores, but South Korean films and goods.
Bitter pill
On Tuesday, the Global Times argued it is not only time to show Lotte the door, but to send a warning, as it put it, to “all the other foreign forces that jeopardize China’s interests.”
The editorial called the decision to move ahead with the installation of the Terminal High Altitude Area Defense (THAAD) anti-missile system a “mighty blow” to “strategic mutual trust” between the two countries.
In a separate commentary on Wednesday entitled “South Korea must face bitter pill over THAAD,” the nationalist tabloid, published by the communist-party backed People’s Daily, was equally harsh, but also circumspect.
“It is imperative for China to adopt sanctions against South Korea. But how?” The editorial listed a range of areas where Beijing could make Seoul feel the pain, noting that nearly half of the country’s foreign visitors are from China.
Diplomatic freeze
In addition to suggesting a freeze of diplomatic ties, the piece noted that South Korean TV shows and live performances had already begun to take a hit. The piece failed to mention, however, that this was largely the result of China banning such performances and the broadcast of popular Korean dramas, not a groundswell of popular discontent.
As it played up the importance of the Chinese market to South Korean companies, it was also clear that tough actions would ultimately cut both ways. Mentioning South Korean companies Samsung and Hyundai, the editorial noted that while China was a large market for both, it added that most of their products were made and sold here.
“Sanctioning them will lead to a complicated outcome,” the editorial said.
In an opinion piece on the controversial deal, China’s Xinhua news agency focused on both South Korea and the United States, but argued that the talk of tough measures did not indicate a change in Beijing’s “embrace for foreign investment.”
Boycott bluster
On the streets in Beijing, some that VOA spoke with were supportive of the ban.
“The very least we can do is to refuse to buy Korean goods and products or stop watching Korean dramas and limit travel to South Korea,” said one young female Beijing resident surnamed Zheng. “As for trade, I hope the government can adopt some policies to sanction [South Korea]."
Others, however, were skeptical of the impact sanctions and boycotts could have.
“Politics and business are two separate things and such actions are unnecessary - much like China’s boycott of Japanese goods in the past,” said a man surnamed Peng.
A 2012 decision by the Japanese government to purchase the Senkaku Islands from a private owner triggered widespread protests in China and calls for a boycott of Japanese goods. The protests were peaceful at first, but later turned violent with some smashing and destroying of Japanese made cars.
At that time when “Chinese were smashing Japanese cars, they were smashing the assets of Chinese people,” said Peng.
Another woman also cited the 2012 protests against Japan. She said that regardless of how bad relations become between China and Japan, the protests and boycotts did not change Chinese consumers demand for Japanese goods or lead to the collapse of companies from Japan here.
“Calling for sanctions will not really do anything to resolve the problem and I hope [China’s] leaders will come up with some measures that are more effective,” Du said.
Culture clash
She added that while some are critical of China’s craze for South Korean culture and soap operas, boycotts and efforts to cut the public off will ultimately fail. What China needs to do, she said, is focus on policies that help expand and grow its own culture, not fighting the expansion or popularity of other cultures.
“This is a time of diversity and you can’t just use boycotts to snuff out the development of another country’s cultural products because the public has many ways of accessing them,” she said. “Just like when you close one website, people will always find another to get the same resources from another.”
Another man surnamed Zhao, a tour guide who takes tourists to South Korea and called himself a fan of Korean culture, said he did not think China should boycott Korean goods. Zhao said that while some view the popularity of South Korean films and culture as a threat to Chinese identity, he does not.
“I think that the export of Korean culture into China actually raises our culture and there’s really no reason to completely boycott it,” said Zhao.
Lotte’s lot
The debate over the deployment of THAAD in South Korea has been simmering for more than a year, and distributors and producers say that while there has been no official confirmation, wildly popular Korean TV dramas have been banned for months.
The future fate of the Lotte Group in China looks increasingly uncertain. The company’s more than 150 outlets and facilities have already come under increasing scrutiny. A massive project in China’s northeastern city of Shenyang was put on hold in December after it failed to pass a fire safety inspection.
And on Tuesday, the same day that Lotte signed an agreement with South Korea’s defense ministry, there were reports that a store in Beijing was fined 44,000 Chinese yuan for violating advertising laws.
Lotte Group said its Chinese website, www.lotte.cn, was hacked this week and has been inaccessible since Tuesday afternoon after the decision was finalized. A Lote Duty Free website is also down following a cyber attack from China, a company official tells Reuters.
Although China is clearly an important part of Lotte's business in the region, it is not the company's only market.
In 2015, the group reported annual revenue of $60 billion, with its retail arm bringing in $26 billion that same year. Almost all of the sales from its retail arm were in South Korea. Overseas revenue was $2.54 billion, with China accounting for more than half of that amount.
