SOUTH KOREA. Incheon International Airport Corporation (IIAC) says that “reasonable” concession support measures for larger retailers at the country’s main gateway are being prepared and will be finalised after discussions with relevant government authorities.
As reported, the government already announced a relief package for small and medium enterprise (SME) retailers at Incheon on 28 February but the larger players such as Lotte Duty Free, The Shilla Duty Free and Shinsegae Duty Free were controversially omitted.
However, what one senior travel retailer told The Moodie Davitt Report were “positive” talks last week have paved the way for the relief measures to be applied to bigger players.
IIAC pointed out that the initial SME measures were in accordance with the government’s policy to prioritise support for companies who are experiencing greater difficulties in business and risks bankruptcy due to liquidity problems.
IIAC responded firmly to public criticism that it is profiting from the misfortunes of duty free retailers who are bearing the full brunt of the coronavirus impact, stating: “IIAC is a public corporation and all proceeds from business operations are appropriated towards paying government dividends, investments in airport construction and contribution towards national economic growth. IIAC’s debt exceeds KRW3 trillion (US$2.4 billion) and the retained earnings from the business is reinvested in airport facilities.”
IIAC’s remarks and relief initiatives come as travel restrictions relating to South Korea (the worst-affected Asian nation outside China, though the situation has eased remarkably quickly) and the continued spread of COVID-19 around the world several impacts passenger traffic.
The corporation announced that passenger volume between March 1 and 15 was 417,000 – a shocking -85% lower than the 2.8 million recorded in the same period last year. There are far more staff (approximately 70,000 staff work at the airport) than passengers at Incheon as flight cancellations cut a swathe through both inbound and outbound traffic.
On 1 February, 1,127 flight took off and landed at Incheon but the spread of the coronavirus in Korea and the ensuing travel restrictions by foreign governments reduced the number to 716 on 1 February and just 257 on 16 February.
Daily passenger volumes at Incheon have slumped below the previous low of 26,773 on 20 May, 2003 at the height of the SARS crisis and new lows are being recorded on a daily basis.
