Today, we are talking about China’s restriction order on South Korea. The order stems from China’s dissatisfaction with Washington’s agreement with Seoul to build a missile defense system (THAAD) in South Korea to protect America’s close allies from North Korea. The Chinese government denounced this in unusually straightforward terms, and a foreign ministry spokesman warned that China was “resolutely opposed and strongly dissatisfied” with the new defense system (Maizland 2017). Later, SARFT issued the policy to restrict Korean artists and programs.
The ban includes: banning Korean stars from performing in China; stopping the investment of new Korean cultural industry companies; stopping Korean idol groups from performing to more than 10000 audiences; banning the signing of new Korean TV series and variety show cooperation projects; banning Korean actors from playing TV series on TV stations, and many other provisions have been conveyed to all TV stations and are required to be implemented on September 1, 2016. In addition to the ban on literature and art, there are also bans on tourism. Since 2017, China’s major tourism companies and travel agencies no longer sell Korean tourism products, and cruise companies no longer sell Korean related airline products.
The headline victim of China’s economic retaliation against the Korean wave is South Korea’s Lotte Group, whose total loss in 2017 is estimated to be $1.78 billion US dollar. In 2017, the number of tourists to South Korea decreased by 48.3%, exceeding 4.5 million. The Institute of modern research estimates that the decline in Chinese tourists has resulted in the loss of about 15.6 billion US dollars of income to the whole economy (Lim & Ferguson 2019).
In terms of entertainment industry, China is one of the largest export markets of South Korea’s cultural industry. According to the statistics of the Korea Cultural Industry Exchange consortium, in the third quarter of 2016, when the “Korea restriction order” came into effect, the stock prices of Korean wave enterprises in South Korea dropped by 14% on average, and continued to decline in the fourth quarter. According to the estimate of the Korean Institute of modern economics, the “Korean restriction order” will cause the loss of Korean cultural industry about 8.7 billion Won. Han Zaizhen, a researcher at the Institute of modern economics, once told South Korean media that exports to China account for about 27% of South Korea’s total exports of cultural industries. According to the data of the Institute of modern economics, compared with South Korean enterprises, the revenue loss of Chinese enterprises caused by the “South Korean restriction order” is “weak”, but no specific data is shown (Lim & Ferguson 2019).
However, the Chinese market still needs high-quality content to attract audiences. Since it is impossible to cooperate with South Korea publicly, many programs that “imitate” South Korean content have appeared in the mainland of China after the promulgation of the South Korea restriction order. Originally, South Korea’s production experience should be transmitted to China through co production, but now the “imitation” mode omits this process. An Renhuan, associate professor of Korean Department of Hebei University, believes that “this will have a negative effect on the improvement of China’s own competitiveness” (Wang 2017). During the “Korea restriction order” period, China was unable to master the content production capacity and technology of South Korea, which made China’s content industry miss the opportunity of growth.
Reference list:
Lim, D & Ferguson, V 2019, ‘Chinese Economic Coercion during the THAAD Dispute’, The Asan Forum, vol. 9, no. 2.
Maizland, L 2017, ‘The surprising reason why China is blocking South Korean music videos and TV’, Vox, 7 March.
Wang, F 2017, ‘Can the Korean wave industry return to the Chinese market?’, BBC News, 12 December.
