China's response to THAAD does not warrant South Korean action: minister

SEOUL (Reuters) - South Korea’s finance minister said on Thursday China had not taken any retaliatory measures over plans to deploy a U.S. anti-missile system that warranted official action, although South Korea is ready to lodge a formal complaint if needed.

South Korean Finance Minister Yoo Il-ho speaks during an interview in Manhattan, New York, U.S., January 11, 2017. REUTERS/Shannon Stapleton

Finance Minister Yoo Il-ho was answering questions from legislators on whether China was taking action against South Korean companies for the planned deployment later this year of the U.S. Terminal High Altitude Area Defence (THAAD) system.

China worries that the system’s powerful radar can penetrate its territory and it has objected to the deployment.

“If China officially takes unfair action against South Korea we would openly move against it, but as long as China says its moves are not related to THAAD and rather, local measures at home, the South Korean government cannot accuse China of retaliating,” said Yoo.

South Korea’s Lotte Group said on Wednesday Chinese authorities halted construction at a multi-billion dollar real estate project in the northeastern city of Shenyang after a fire inspection.

Yoo said Lotte executives had told the government the Chinese decision to halt the project was not directly related to the deployment of THAAD.

South Korea and the United States have said the missile system is only intended to defend against North Korean aggression.

Hours before Yoo’s appearance at parliament, the Bank of Korea said the number of Chinese tourists going to South Korea’s tourist island of Jeju, had fallen 6.7 percent over the Lunar New Year holiday from last year.

The central bank said in a report the fall in arrivals was partly due to China’s “anti-South Korea measures due to the THAAD deployment decision”.

Earlier, South Korean officials said they suspected a Chinese decision in December to deny applications from South Korean airlines to expand charter flights between the countries was “indirect” retaliation for South Korea’s deployment of the missile system.

China has not commented on South Korea’s suspicions about retaliation.

Reporting by Christine Kim; Editing by Robert Birsel