Macao is the only place in China where gambling is legal. The former Portuguese colony now generates about six times more annual gambling revenues than does Las Vegas. In fact, the gaming industry there has expanded more than 17-fold in the past decade. The leaders in the American gaming industry including Las Vegas Sands (NYSE: LVS), Wynn Resorts (Nasdaq: WYNN) and MGM Resorts International have been foremost among the players in that market.
But when it comes to the Asian gambling market as a whole, Macao is just the tip of the proverbial iceberg. Singapore has shown even more dramatic growth than Macao since gambling was legalized in 2009. It has two casinos currently – Resorts World Sentosa owned by Malaysia's Genting and Marina Bay Sands owned by Las Vegas Sands. Just these two casinos alone had revenues last year of $6 billion, which put them roughly on par with Las Vegas as a whole!
No wonder then that the chairman and CEO of Las Vegas Sands, Sheldon Adelson, said last year that Singapore had transformed the way companies like his looked at Asia.
Asian countries too are looking at gambling in a whole new light. Both Japan and South Korea have viewed Singapore's success with envy. Both countries have had qualms about the gambling industry in the past but are reconsidering their positions due to Singapore showing how the gaming industry can co-exist with tight government regulations and control.
In Japan, legislators are moving slowly toward legalizing casinos. But there remains strong opposition to casinos, so do not expect action there for at least two years. If casinos do open in Japan, they should flourish. The country already has more than 5 million slot machines and 12,000 pachinko halls. The first casinos there are expected to generate at least $10 billion in their first two years.
Japanese billionaire Kazuo Okada, which made his fortune in Japan with pachinko machines, is in the midst of a feud with Steve Wynn of Wynn Resorts. The reason for the feud that many observers point to is the fact that Mr. Okada, who owned 20% of Wynn Resorts stock, was going to open a casino in the Philippines without Wynn. With the Philippines being such a tiny market, imagine how they'll fight over the big markets in Asia!
Mr. Okada is planing to do just that. He plans to invest $4 billion into a casino resort in South Korea, beating both Wynn and Sands to the punch. South Korea currently has only poorly-run, state-owned casinos.
Taiwan is another potentially lucrative market for the casino operators. The government there passed legislation which allowed casinos to be built on three islands located in the Taiwan Strait, near China. And then there is the possibility of mainland China with cities like Beijing, Shanghai and Hong Kong on the list as potential casino sites.
Vietnam too has attracted a lot of interest from foreign casino operators. There have been some casinos operating in the country for about two decades. Las Vegas Sands is planning a project located near Ho Chi Minh City. MGM Resorts International is also in Vietnam, agreeing to manage a property that is being built at a new beach resort, again near Ho Chi Minh City.
With the growing riches in Asia and all of the casino projects already underway or to be started within a few years, the future looks brighter than the Las Vegas Strip for the American casino companies finding their fortune in Asia.
This article was originally written for the Motley Fool Blog Network. Be sure to check out my daily articles for the Motley Fool at http://blogs.fool.com/tdalmoe/
Subscribe to:
Post Comments (Atom)
Posts
Want to visit Macau because of several places to try your luck and enjoy days with their rich culture and other amusement games.
ReplyDeleteI would loved too try it too. Were been traveling for sometime in a year so were looking for a prospect place to visit for a project but usually enjoying the vacation too. Our last travel is arranged by ferien malediven which give's us comfortably and satisfaction with their services and indeed the place is perfect!.
ReplyDeleteHoping to visit Macau soon. I hear it is gorgeous there and so full of life!
ReplyDeleteWell, just like they said, It's really great, I've been to Macau few time already and I really enjoyed my stay there.
ReplyDelete_______________
Ashley | Olympics 2012 London
I guess Asia is now the land of opportunity.
ReplyDeleteHi! I wish to say that this post is awesome, nice written and include almost all significant infos. I would like to see more posts like this .
ReplyDeleteCasino India