Unstoppable Chinese Duty-Free Shops, Surpassing Korea and Switzerland to Take 1st Place

China CDFG Sales 6.6 Billion Euros
Effect of Focused Development in Hainan Duty-Free Zone
Lotte and Shilla Rank 2nd-3rd... DFS Drops to 4th Place

On the 24th, the duty-free shop at Terminal 1 of Incheon International Airport is quiet due to the impact of COVID-19. Photo by Mun Ho-nam munonam@

[Asia Economy Reporter Jo In-kyung] In a situation where global travel has been halted since COVID-19, China's duty-free industry has rapidly grown, surpassing Korean duty-free shops to claim the top spot.

According to the British duty-free industry specialist publication Moody David Report on the 28th, last year, China Duty Free Group (CDFG) recorded sales of approximately 6.63 billion euros in the global duty-free market, soaring from 4th place worldwide in 2019 to 1st place in a single leap.

Following were Lotte Duty Free with sales of 4.82 billion euros and Shilla Duty Free with 4.29 billion euros, maintaining their 2nd and 3rd places respectively as in 2019. Swiss company Dufry, which had held the top spot in the duty-free market for several years, saw its sales drop by more than 70% compared to the previous year to 2.37 billion euros, falling to 4th place.

The Moody Report pointed to the Chinese government's focused development of the Hainan region as a duty-free special zone as the reason behind CDFG's rapid growth. In 2018, China designated this area as a free trade port where cargo, capital, and personnel can freely enter and exit, and has continuously expanded the per-person duty-free limit from 16,000 yuan (approximately 2.75 million KRW) to 30,000 yuan (5.14 million KRW), and since the second half of last year, to 100,000 yuan (17.13 million KRW).

Additionally, since last year, the Chinese government has allowed domestic visitors to Hainan to purchase duty-free goods online for 180 days after returning to the mainland.

On the other hand, the proportion of Chinese "ttaigong" (personal shoppers) in duty-free sales was around 70-80% before COVID-19 in 2019, but increased to over 95% last year.

A duty-free industry official stated, "With virtually no general tourists in the domestic market, if even the ttaigong turn their attention to the Chinese domestic market, it would be a direct blow," adding, "More proactive policy support is needed, such as raising the domestic duty-free limit or implementing a duty-free limit advance payment system that allows purchases assuming future departure."

This content was produced with the assistance of AI translation services.