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Economy

South Korea's tourism industry fights MERS, service woes

SEOUL -- South Korea's tourism industry has been devastated by the recent outbreak of Middle East respiratory syndrome.

The MERS outbreak has delivered a devastating blow to South Korean tourist hot spots, such as Seoul’s Myeongdong shopping district.

     But the mysterious virus is not the only cause of dwindling overseas arrivals. Seoul needs to come up with a new strategy if it wants to lure back visitors from China and Japan. One sign of trouble is the declining share of returning tourists. Many complain of a shortage of hotels and underdeveloped transportation networks.

     On July 1, the government announced measures to stem the decline. It said Chinese with group tourist visas issued by Japan are now allowed to enter South Korea and stay up to 15 days with no additional paperwork. The move reintroduces a waiver that was suspended in September 2012 because of a surge in visitors who overstayed their visas.

     The waiver is handy for Chinese tour groups planning to visit both Japan and South Korea, said Kim Young-june, commissioner of the Korea Immigration Service, at a press conference in Seoul on July 1. The government also said it will waive the $15 tourist visa fee for visitors from China and four Southeast Asian nations -- Cambodia, Indonesia, the Philippines and Vietnam -- from July 6 through September. In another step to boost inbound tourist traffic, the validity of one-time visas issued between March 1 and the end of June has been automatically extended from three months to six months.

Staying away

The moves were prompted by falling arrivals from overseas. The number of foreign visitors to South Korea in June plunged by half from a year earlier, according to the Justice Ministry. The number of Chinese visitors, the largest group of foreign tourists, tumbled 54% in June to about 260,000.

     Chinese tourists spend an average of 2.32 million won ($2,053) per trip, according to the Seoul municipal government. With the drop in the number of visitors, that translates to a loss of about 700 billion won in June alone.

     The South Korean government is desperate to contain the MERS outbreak and bring the tourists back, but an end to the crisis may not ensure a recovery. The number of Chinese tourists who want to visit the country again had been trending down even before the outbreak.

     According to the Korea Culture and Tourism Institute, a semipublic think tank operating under the tourism ministry, the share of repeat visitors among Chinese travelers fell to 25.8% in 2013 from 37.4% in 2010.

     Complaints about inadequate accommodation and transportation are being blamed for the drop. A survey of around 1,000 mainly foreign tourists by the Korea Tourism Organization found the number of complaints over accommodation rose to 118 in 2014 from 95 in 2013. Gripes about airport and airline service increased to 70 from 65, while complaints about railway and ship service hit 35, up from 23.

No star

Construction of new hotels has failed to keep up with earlier growth in the number of foreign tourists, resulting in a shortage of lodging. Guest houses and private homes are now being used to accommodate visitors, but they are not as popular as hotels. Another major problem is inadequate railway service connecting the capital with far-flung destinations. That partially explains why 80% of foreign tourists stay in Seoul for their entire trip.

     Another reason smaller cities and towns are finding it difficult to attract foreigners is that many come mainly for shopping. "One big problem with our tourism industry is that we don't have cities like Kyoto or Osaka," a Korea Tourism Organization official said.

     There is a growing chorus of calls in the industry for policies to promote cruises, medical tourism and casino resorts. But efforts to bring first-timers back by offering more diverse attractions and destinations have barely begun.

     South Korea in 2009 surpassed Japan in arrival numbers. In 2014, it welcomed 14.2 million foreign tourists, 790,000 more than Japan brought in. But Japan overtook South Korea during the first five months of 2015 by pulling in more Chinese. South Korea had been ahead of Japan in pursuing a national strategy to boost foreign tourism. But on current trends, it is likely South Korea will fall behind Japan in this metric for the first time in seven years in 2015.

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