SOUTH KOREA. Hanwha Galleria Timeworld has struck an agreement with Korea Airports Corporation to “temporarily” extend its duty free operations at Jeju International Airport until 31 December.
It is understood that the airport authority has granted the retailer rent relief in light of the current trading crisis – something alluded to by Lotte Duty Free earlier today as it pleaded for similar rent relief from Incheon International Airport Corp.
However, the retailer has no plans to keep trading before year-end. A spokesperson told The Moodie Davitt Report: “We will operate until December 31st, 2017 and don’t regard [plan on] staying open in 2018.”
As reported, Hanwha Galleria had planned to exit its contract early on 31 August due to the collapse of Chinese tourism driven by the THAAD political dispute between China and South Korea. The concession was due to run until 2019.
The retailer told The Moodie Davitt Report on 6 July: “With the long-term evaporation of Chinese travellers, Galleria is terminating the contract for duty free business at Jeju international Airport.
“Not only have the average monthly sales remained below the monthly fixed costs (rent fee) for operating the Jeju duty free shop, but also the duty free market has entered a serious phase of stagnation. So, Galleria is no longer able to sustain the business.”