The Nature Republic cosmetics store in the Myeong-dong shopping district in downtown Seoul has been an obligatory stop for Japanese women visiting Korea, but no longer. Until last summer, the place was crawling with Japanese tourists, but now most customers are Chinese.

The main culprit is the weak Japanese yen. According to the Korea Tourism Organization, the number of Japanese tourists in Korea stood at around 300,000 in September last year but dropped to 220,000 in December.

In contrast, the number of Korean tourists heading to Japan, which had plunged 32 percent in 2011 on-year just after the Tohoku earthquake, rose 21 percent at the end of 2012.

This trend is not restricted to tourism. The weak yen is affecting the financial, retail, manufacturing and hotel industries here as well.