Lotte takes flak over THAAD links

Ministry calls on retailer to abide by local laws

China's Ministry of Commerce spokesman Sun Jiwen made the remarks on Thursday at a news conference amid Chinese netizens' anxiety and anger, stirred up by South Korea's planned deployment of the Terminal High Altitude Area Defense system, whose radar was reportedly able to cover parts of China and Russia.

South Korea signed a land swap deal on Tuesday with Lotte for the missile shield.

"South Korea's THAAD deployment plan not only gravely undermines China's strategic security interests, but also hurts the two countries' bilateral cooperation," Sun said.

He called on South Korea to "stop going further on the wrong path".

"We understand the legitimate concerns of the relevant parties in maintaining their own safety, but one country's security should not come at the sacrifice of another," Sun continued.

In the grip of the overriding sentiment, quite a few Chinese netizens expressed their opposition to Lotte's products and services.

In response to the simmering anger, Sun said, the government welcomes all foreign companies, including those headquartered in South Korea, to do business in China, and will always protect their legitimate rights.

"But the premise is that the enterprises must comply with Chinese laws", Sun added.

Lotte, South Korea's fifth largest conglomerate, has suffered sluggish retail business in the Chinese market, with its same store sale growth shrinking by 14 percent last year at year-on-year basis.

Lotte has opened 115 supermarkets in China since entering the country in 1994. It planned to close three retail stores in China in 2017 due to its declining performance in 2016, the company said earlier.

Being a latecomer to China's highly competitive retail market, Lotte has less than a 1 percent market share in the country, due to limited advantages in terms of location, merchandise and price, according to Jason Yu, general manager of market research firm Kantar Worldpanel China.

Last December, the group called an end to a $2.6 billion-worth theme-park project in Shenyang, Liaoning province.

Zhao Ping, deputy director of the Chinese Academy of International Trade and Economic Cooperation, under the Ministry of Commerce, said that from a long-term perspective, the incident would have limited impact on China-South Korean economic and trade relations.

Trade volume between China and South Korea was 166.7 billion yuan in 2016, down 2.7 percent from a year earlier, according to Customs data. China is South Korea's largest trade partner.