South Korea tourism faces losing revenues due to strained China ties

Policemen patrol outside a Korean Lotte Mart in China's capital, Beijing, on March 9, 2017, as a diplomatic row over a controversial US missile system sparked boycott calls against South Korea. (Photo by AFP)

South Korea's tourism faces losing billions of dollars of revenues due to strained relations between Seoul and Beijing over the deployment of a US missile system.

South Korean revenues from airlines, travel agencies, package tour operators and cruises will drop about $5 billion, according to estimates published by Bloomberg on Friday.

The China National Tourism Administration (CNTA) has ordered local travel agencies to stop selling tours to South Korea.

More than eight million Chinese tourists visited South Korea in 2016 alone.

Diplomatic ties between China and South Korea deteriorated dramatically after the United States announced the controversial deployment of the Terminal High Altitude Area Defense (THAAD) missile system to South Korea on March 6.

Washington claims the deployment aims "to defend against North Korea's ballistic missiles."

However, military experts say THAAD not only poses a serious threat to North Korea, but also threatens China and Russia.

THAAD is equipped with a special X radar system that experts say would destabilize the region's security balance.

China's Foreign Ministry announced on March 7, "We are firmly opposed to the deployment of THAAD in the Republic of Korea (ROK) by the US and the ROK."

Russian media said on the same day that Moscow was opposed to the deployment.

Beijing and Moscow have said they would take countermeasures.

This handout photo from the US Forces Korea (USFK) taken on March 6, 2017 shows a THAAD battery at Osan US Air Base south of Seoul, South Korea. (Photo by AFP)

Last week, the CNTA issued a "7-point" directive to travel firms to curtail or ban trips to South Korea starting March 15, local media sources reported.

Media sources said the crackdown sent jitters across South Korean retail and tourism sectors, which rely heavily on Chinese trade and tourists.

Seoul is considering filing a complaint against Beijing with the World Trade Organization over what it has described as trade retaliation over the issue of the THAAD deployment.