The Republic of Korea (RoK)’s retail and chemical giant Lotte Group is ramping up efforts to tap deeper into Southeast Asia and advanced economies amid falling sales in China, once its biggest overseas market, industry sources said on May 28.

Lotte World Tower (Source: Koreatimes.co.kr)

According to the Yonhap News Agency, overseas sales of the conglomerate reached 8.9 trillion KRW (7.49 billion USD) in 2018, up 7.2 percent against the previous year.

It marks a turnaround from the near 7 percent on-year drop in 2017 in the wake of a bitter diplomatic row between Seoul and Beijing over the deployment of an advanced US missile defense system in the RoK.

Four Southeast Asian nations, namely Malaysia, Indonesia, Vietnam, and the Philippines, accounted for 58.4 percent of Lotte’s total overseas sales last year.

Malaysia was the top contributor with 30.3 percent of the total, followed by Indonesia with 13.3 percent, and the US with 9 percent.

China ranked fourth with a 7.9 percent share, down one spot from the previous year. The world’s second-largest economy was the leading source of Lotte’s overseas revenue with 25 percent in 2016.

In the aftermath of the missile defense showdown, Lotte’s sales in China, which stood at about 2 trillion KRW in 2016, dived down to 700 billion KRW last year.

Lotte said its sales in Southeast Asia will increase sharply once a chemical plant in Indonesia, whose groundbreaking is slated for sometime this year, is completed.

Southeast Asia’s bigger share comes amid Lotte’s push to diversify overseas markets away from China and make forays into other emerging and advanced markets.

In his New Year’s speech, Lotte Chairman Shin Dong-bin stressed the need to review its emerging market strategy and map out a specific plan to expand operations in advanced markets.

In line with Shin’s policy, Lotte advanced into the Oceanian duty-free market in January this year by acquiring four duty-free shops in Australia and another one in New Zealand.

Earlier this month, Lotte Chemical Corp., the group’s chemicals arm, completed construction on an ethylene plant in Louisiana. US Lotte Chemical holds an 88 percent stake, with US Westlake Chemical Corp. owning the remainder.

(Source: VNA)