Will China ease THAAD retaliation?

A Lotte Mart staff stands in an almost empty Lotte Mart in Shanghai, Monday. / AFP-Yonhap

By Yoon Ja-young

China may tone down its economic retaliation against Korea for deploying the U.S. Terminal High Altitude Area Defense (THAAD) system following the impeachment of former President Park Geun-hye, industry officials and analysts said Monday.

They said the March 15 Consumer Rights Day would determine the direction of China’s retaliation.

According to retail companies operating in China, Chinese authorities started restricting anti-Korea protests in the country after Park impeachment was upheld last Friday.

Lotte, which decided to swap its golf course in Korea with the defense ministry to enable THAAD to be installed there, has been the main target of retaliation.

The retail giant has had to suffer various disadvantages in China.

China contended that the U.S. missile defense system on Korea threatened its security, even though Korea needs the system to protect itself from growing nuclear and missile threats from North Korea.

Authorities suspended the operations of more than half of the Lotte Mart shops in China, citing violations of minor fire safety regulations.

The company is expected to lose more than 50 billion won in sales, while still paying salaries to Chinese employees who are not working.

Lotte’s chocolate factory in Shanghai, set up jointly with U.S. company Hershey Chocolate, was also ordered to close for one month for violating fire safety regulations.

Several protests were scheduled for the weekend, but Chinese authorities canceled them.

There is speculation that China may be easing its persecution of Korean companies ahead of Korea’s presidential election that must take place within 60 days of the impeachment.

“Ahead of the United States’ secretary of state visiting China on March 18, China seems to be toning down retaliation against Korea,” said Hyundai Research Institute analyst Chun Yong-chan.

“It has no reason to want such a hostile atmosphere while meeting him.

“With the impeachment completed, Korea entered presidential election mode. If China continues bashing Korea, public opinion about China will turn negative. Then, presidential candidates will also have to turn negative about China.”

There has been speculation that a new administration may reconsider the THAAD deployment because most of the potential candidates, especially those from the opposition bloc, have been cautious about the move.

But Chun said it was too early to say whether China had changed its behavior.

“It is just like a strategic pause,” he said. “We have to watch the talk between the United States and China.”

Some observers believe that March 15 Consumer Rights Day will be a gauge of whether China will continue to retaliate.

China’s state-run China Central Television (CCTV) has been running “3.15 Show,” an annual investigative special, which focuses on corporate malpractice.

Global companies like Apple and Volkswagen succumbed to the program, promising to resolve the issues.

If the program chooses to attack Korean companies, the hostile atmosphere is likely to continue.

“Companies mentioned on the program usually become the target of a harsh boycott,” said an analyst in Seoul.

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