Jeju, South Korea - The southern holiday resort island of Jeju, around 90km off the coast of the Korean Peninsula, is seeing a plummeting number of Chinese visitors - an immediate and direct consequence of the ever increasing tensions of geopolitics in the region.

This drop comes as China has taken a number of retaliatory economic measures, including banning tour packages to South Korea by Chinese tour operators, after Seoul decided to deploy an advanced US missile defence system, known as the THAAD, against a possible North Korean missile attack.

China claims that an advanced radar system that comes with the THAAD system could be used to monitor a large part of China and compromise its national security.

This volcanic island has seen an explosive growth of Chinese tourists every year over the past decade, reaching more than 3 million in 2016.

However, with many direct flights being cancelled and Chinese cruise ships banned from docking in South Korean ports, the number of daily Chinese tourists arriving in Jeju has nosedived by as much as 80 percent compared with the same period last year.

Half of our staff has been placed on unpaid leave. We recorded a deficit in February and March with revenues shrinking to 50 percent Moon Su-hwan, Benekia Hotel

Hotels, restaurants and tour operators, catering to Chinese tourists, are suffering from the loss of business opportunities.

"Half of our staff have been placed on unpaid leave. We recorded a deficit in February and March with revenues shrinking to 50 percent," Moon Su-hwan, planning and marketing director of Benikia Hotel Jeju, told Al Jazeera.

This bleak number is something that China would have wanted.

Jeju residents say the Chinese ban is a blessing in disguise.

"We learned a lesson that Chinese tourists could be hugely influenced by China's politics and a high dependence [on them] is problematic," said Won Hee-ryong, Jeju Province governor.

The island is refocusing on the domestic market, diversifying its target market and focusing on southeast Asian countries, Japan, and Middle East nations.

Industry players have also looked to transform Jeju from a place of simple sight-seeing and shopping into a premium holiday destination.

The island's tourism-related industry raked in $1.58bn in 2016, one third of which went to large companies such as duty free shops, another third to shops, restaurants, and hotels frequented by Chinese tourists.

Only one third went to local businesses, according to local government. Industry insiders say Chinese companies will lose out the most.

"This process will be painful. However, eventually, this process will make us more healthy and strong," added Won.