South Korea intends to lower its regulatory hurdles for new resort casino projects in order to attract a greater number of international developers. This week, the Ministry of Culture, Sports and Tourism issued a report saying South Korea had “fallen behind” regional competitors like Macau and Singapore.
To address this imbalance, the Ministry plans to “revise related regulations to foster integrated resorts and draw up systematic measures.” A new “open” bidding system will be in place by the first half of 2015 and a task force will be formed to help operators realize their casino development dreams.
There are currently 17 small-scale casinos in South Korea, all but one of them (Kangwon Land) restricted to holders of foreign passports. There are three large-scale projects underway in the country – the Paradise Sega Sammy joint venture near Incheon, the Caesars Entertainment/Lippo Group project on Yeongjong Island and Genting Singapore’s Resorts World Jeju on Jeju Island.
Paradise’s new casino won’t open until 2017, but Paradise Co. Ltd. likely wishes that date was a whole lot closer after its second quarter profit fell 35.9% to KRW 23.9b (US $23.1m). Revenue from Paradise’s five existing casinos rose 12.4% to KRW 172.5b in the three months ending June 30 while gaming revenue grew 16% to KRW 148.8b. Chinese VIPs accounted for two-thirds of overall turnover, which rose 16.8% to KRW 1.7t.
In keeping with tradition, Paradise’s five casinos couldn’t compete with Kangwon Land, which saw profit rise nearly 32% year-on-year to KRW 100.5b as turnover rose 9.5% to KRW 1.5t. In July, Kangwon Land broke ground on a new water park to complement its existing entertainment options. The High1 Water World expansion expects to open in the second half of 2016.