CASINO

Japan casino market could reach as much as $24 billion

TAGs: Casino News, chris jones, Japan, telsey

which-casino-would-be-awarded-the-first-license-in-japan-featuredMuch has been made of the enormous potential of Japan’s casino market, including throwing out estimates on how much gross revenue the country’s (future) casinos can earn in a year.

Telsey Advisory Group’s Senior Gaming & Lodging Analyst Chris Jones recently issued a 44-page analysis of Japan’s casino potential. Jones estimated that the country could stand to earn as much as $23.8 billion a year, which translates to 0.4 percent of the country’s GDP, roughly what US casinos earn relative to America’s GDP.

A far more conservative, if not more likely estimate would be about $16.5 billion a year with the brunt of the earnings coming from Tokyo, which Jones believes can support two casinos. Supposing that an $8 billion casino is built in Tokyo and another smaller one is built somewhere across Tokyo Bay, those two establishments could potentially earn as much as $10 billion in revenue a year between themselves.

Meanwhile, a $6 billion casino project in Osaka could earn as much as $3.8 billion a year. Hokkaido and Kyushu have been pegged as receiving large regional casinos, which could each return as much as $1.8 billion in revenue a year.

However, Jones also believes some impediments could hamper the market’s full potential. One is the slow progress the country has made in meeting the government’s tourist number goals. Japan has set a target of 18 million visitors in 2016 and 25 million in 2020, but it has yet to accomplish its more short-term goal of attracting 10 million visitors a year. Even the allure of hosting the 2020 Olympics won’t be enough to tilt those numbers in the long term.

Jones also pointed how the country’s casino market could have a domino effect on other jurisdictions. The analyst made a point of highlighting South Korea, which could lose as much as one-third of its casino business to Japan, forcing the country to adopt a more relaxed policy of allowing its own citizens to play in their casinos.

Comments

views and opinions expressed are those of the author and do not necessarily reflect those of CalvinAyre.com