Inside Asian Gaming

October 2017 inside asian gaming 11 Cover Story An outbreak of the deadly Middle East Respiratory Syndrome (MERS) in mid-2015, combined with China’s economic downturn, hit Korea’s gaming industry hard, but unlike Macau – which has staged a remarkable recovery over the past 12 months – there has been no return to the good old days just yet. Instead, Korea finds itself seriously hamstrung by political events around – most notably the relentless conflict with its North Korean neighbor. On 2 March this year, Beijing announced a ban on all travel groups to South Korea in response to the latter’s decision to deploy a THAAD missile system following increased military activity north of the border. As a result, arrivals from China fell by almost 50% for the first seven months of 2017, according to the Korea Tourism Organization, from 4.7 million in 2016 to just 2.5 million through 31 July. But that hasn’t stopped Mohegan Sun from pushing ahead with its US$1.6 billion integrated resort in the Korean gateway L ike the popular girl at school left waiting at the altar, Korea’s tremendous international appeal as the next big thing in gaming has seemingly gone AWOL in the space of two short years. Gaming revenue, which peaked in 3Q14 at US$348 million across its 16 foreigner-only casinos, has endured a steady decline since – reaching US$300 million just once in the nine quarters since 2Q15 and sitting around US$250 million for each of 1Q17 and 2Q17. A government initiative to boost tourism by offering two new casino licenses for foreigner-only integrated resorts attracted 34 initial expressions of interest after it was announced in January 2015 but only six companies followed through with an application by the November 2015 deadline. Just one of those – a consortium led by US tribal gaming group Mohegan Gaming & Entertainment (also known as Mohegan Sun) – ultimately satisfied the government’s investment requirements. “Unlike Macau – which has staged a remarkable recovery over the past 12 months – there has been no return to the good old days just yet. Instead, Korea finds itself seriously hamstrung by political events around.” An artist’s impression of Caesars’ Korean IR