Southeast Asia

Revving the Engine: How Southeast Asia is using gaming as an economic generator

It seems like an eternity since we heard discussions about the robust nature of gaming in Southeast Asia. Recent discussions have surrounded the continued development of brick-and-mortar facilities in areas like Vietnam, Laos and others. Most of the concerns about gaming were related to the crackdown on online gaming that had been influenced by China and the geopolitical pressures they propagate to exercise their policy views on various parts of the world.

However, SARS-CoV-2 came and shuttered the gaming world as part of the Great Shutdown. Since then, many existing land-based gaming properties have struggled to reopen or, if open, are operating at less than full capacity.

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Reform to perform: Shutdown provides rare POGO opportunity

As the brick and mortar gaming world fell silent in response to the coronavirus, many online gaming operations continued throughout the pandemic. However, the Philippine Amusement and Gaming Corporation (PAGCOR) and President Rodrigo Duterte also shuttered the Philippine Online Gaming Operators (POGOs) in the middle of March in response to the outbreak. POGOs have made a sizeable impact financially to the Philippines, with revenues increasing by more than 13% from 2018 to 2019.

In late April, the government began to hold conversations about restarting these operations and deeming them essential businesses as a way to help finance a government heavily hit by a revenue shortfall due to the pandemic. After a six–week break, they were allowed to restart these operations following the strictest guidelines issued by the government under the Enhanced Community Quarantine (ECQ). Restrictions included limitations on staff sizing (30%), shuttle services for employees, temperature checks, social distancing and masks for employees.

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Social Safeguards: How Singapore set a new standard in addressing responsible gambling

As Singapore continues to serve as the model for IR development, it has also become one of the current models to address the promotion of responsible gaming measures and casino exclusion policies for its two integrated resorts.

At the time of inception, these cutting-edge initiatives allowed for a different model for individuals to be excluded from the casino, limited the floor size of the facilities, created a publicentity to promote responsible gaming efforts, and created partnerships with operators to work with the government in creating an environment of responsible gaming. It also introduced a casino levy for locals with the option of a daily or yearly fee.

The two operators in the market, Las Vegas Sands (Marina Bay Sands) and Genting Singapore (Resorts World Sentosa), initially had to develop internal responsible gaming education and training programs. These initiatives have continued to evolve over the course of time as more research has become available and the market has matured. The programs include an initial and annual training that offers employees the ability to understand the signs of problem gambling, as well as how to respond and support a guest. It also includes support in the form of high level specialists that offer a higher level of knowledge on responsible gaming measures and how best to handle a guest that may need further assistance.

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Vietnam’s Strip: The central coast of Vietnam is likely to become the next region with multiple destination casinos and integrated resorts

The Strip” has long been a popular term in the casino industry. Originally used to describe Las Vegas Boulevard from Sahara Avenue south to Russell Road, the term was adopted to describe clusters of casinos and hotels in other jurisdictions including the Cotai Strip in Macau and, most recently, for a proposed multi-property development called the Osaka Strip in Osaka, Japan.

While the latter development remains a possibility, a new strip of hotels, resorts and casinos is quickly emerging on the central coast of Vietnam, in and around Da Nang: the Central Coast Strip, stretching from Hoi An to Hue.

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Cambodia Rising

Major casino operators have long perceived Cambodia as a tertiary gaming market – a collective mix of border casinos that catered to residents of adjacent countries seeking a convenient place to gamble. The absence of robust gaming regulations further discouraged larger operators from considering acquisitions or developments in the Kingdom. That perception is changing.

Anticipated changes in the regulatory environment coupled with dramatic growth in casino markets throughout the country has caused casino developers to take a closer look at Cambodia.

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Regulatory uncertainty continues to cloud prospects

In late February, gaming industry stakeholders converged in Goa at one of India’s first gaming specific conferences: Sports Betting & Gaming India (SBGI). The event, led by Eventus International at the Park Hyatt Goa Resort and Spa, was well attended considering the gaming market is largely in its infancy.

Over 150 attendees discussed several India-specific topics, including the market’s value and potential from an online, lottery, sports betting, and land-based perspective, as well as the regulatory and legislative hurdles involved to expand the market. These types of events have become a necessary first step for stakeholders to understand an emerging market’s value and provide guidelines on how to participate.

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Research Brief: Gaming in India

Since the release of Global Market Advisor’s (“GMA”) white paper entitled “Gaming-In-India-White-Paper” in April 2016, India’s gaming market has evolved with a new gaming license issued in Goa and the potential legalization of gaming in India’s second largest populated state: Maharashtra. In this research brief, GMA quantifies the value of the potential gaming market in Maharashtra and includes an updated review of the gaming market in Goa.

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History and Current Status of Gaming in Taiwan: A White Paper

Taiwan has long been a venue of interest among foreign casino investors, originally because of the importance of Taiwan as a source of customers and more recently because of the potential to reach Chinese customers through the ever-increasing transportation and tourism links between Taiwan and China. The effort to bring casino gaming to Taiwan, however, has been a journey of stops and starts over the past 25-plus years, though there has been fairly steady progress since 2009.

In 2009, the Taiwanese island of Penghu held a public referendum on the establishment of casino-based tourist zones. The referendum was the culmination of nearly twenty years of advocacy on the part of politicians, gaming companies, university professors and professional advisors. The referendum failed. However, in 2012, Matsu held a referendum that passed. While the success of Matsu’s referendum was supposed to politically incentivize the Taiwanese government to pass gaming legislation regulating casino operations, and the government did retain a law firm to draft the Tourism Casino Administration Act (the “Act”), the Act has been stalled in Taiwan’s legislature since 2013.

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Asia’s Sleeping Tiger

Since the emergence of Macau and Singapore as two of the world’s largest gaming markets, casino developers have looked at other jurisdictions within Asia for the next great opportunity. Japan, South Korea, Vietnam, the Primorye region of Eastern Russia, the Philippines and Cambodia have all generated varying amounts of interest from international casino developers. Japan, with its large and prosperous population, now appears to be out of play, at least for the foreseeable future.

The remaining countries’ nascent casino industries are all highly dependent on gamers from China and, as has been clearly demonstrated over the past two years, gaming revenue from Chinese. As such, the next great Asian casino development opportunity remains elusive.

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