South Korea’s Lotte Group appears to be paying the price in China after the conglomerate got involved in the Korean government’s plans to install a controversial US missile defense system.
The Korean firm revealed Monday that it has been forced to shut nearly two dozen stores in China as mainland authorities carried out inspections and deemed the outlets as posing fire-safety risks.
In a statement, Lotte confirmed that operations have been suspended at 23 of its outlets in China, where it has a total of 115 supermarkets.
The group did not provide details, but it is believed that it is paying the price for its involvement in a land swap deal with the Korean government, the Hong Kong Economic Journal reports.
Lotte is said to have angered Beijing after the group agreed to a land swap deal with the Korean government to enable the installation of the US Terminal High Altitude Area Defense (THAAD) missile system on the outskirts of Seoul.
Beijing has voiced objections to the missile system, saying it poses a security threat to China.
The Anhui fire department said on its Weibo page Monday that it has temporarily shut two Lotte Mart stores because of fire-safety issues, part of a broader regional sweep that led to closures of at least 30 stores.
Meanwhile, there have been reports that Lotte has faced demonstrations outside its Chinese stores, with angry crowds denouncing the group for aiding the Korean government’s missile system plan.
At one Lotte Mart in Jilin province, people holding Maoist posters were seen chanting slogans such as “Say no to THAAD” and “Boycott Korean goods”, Agence France-Presse reported.
China’s foreign ministry sought to play down the tensions, saying Beijing welcomes all South Korean ventures and investments in China.
However, a spokesperson added that investors should act in accordance with “the law and (ensure) compliance”.
Diplomatic relationship between China and South Korea has turned sour due to Seoul’s plans for the THAAD system.
Seoul says the defense shield is aimed at countering the missile threat from North Korea, but Beijing opposes the plan, pointing out that the system will have radar that can penetrate Chinese territory.
Demonstrations against Lotte and other Korean firms in China have only just begun, according to some observers.
In Zhengzhou, protestors waved Chinese national flags and destroyed Lotte goods under banners that bore messages such as “Get the hell out of China”.
Many protestors applauded the destruction of Lotte items and held banners with insulting slogans targeting Lotte Mart, HK01.com reports.
Meanwhile, there is suspicion that at least one of the protests in Zhengzhou was orchestrated by a rival supermarket operator.
Amid the protests, netizens engaged in heated discussions as to whether it was correct to boycott Korean goods and Lotte specifically.
Some commentators pointed out that the THAAD system is being implemented by the US, and that it’s not fair to target South Korea.
A person wondered why they were not boycotting Hollywood or Apple, instead of Lotte, given America’s key role in the missile system that will be at close range to China.
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