Inside Asian Gaming

INSIDE ASIAN GAMING | 8 In a ranking undertaken earlier this year of the 20 largest gaming companies by US dollar revenues, Global Betting & Gaming Consultants discovered that every company in the top 10 has a direct involvement in Asia either as an operator or investor. The phenomenal success stories that are Macau and Singapore have set a pace for revenue growth in the larger Asia-Pacific region that PricewaterhouseCoopers believes will surpass the United States this year as the world’s largest. By 2015, the firm expects regional gaming revenues will hit US$79.3 billion, accounting for 43% of the global market. What this foretells is a “geographic shift in revenue origination,” PwC says. “This trend reflects the fact that demand in Asian countries currently far outstrips supply and that, for the next few years at least, operators and countries that offer further high-quality capacity in the region can be fairly certain that they will soon see it absorbed.” Which, of course, speaks more or less directly to the profound influence of China on the region’s leisure and tourism landscape. Rapid urbanization, rising disposable incomes and the relaxation of government restrictions on travel have transformed the Chinese population into the largest source of tourism revenue on Earth, a record $102 billion last year. International trips by Chinese citizens in 2012 exceeded 82 million. By 2015 they are expected to reach 100 million. “This happened all in one generation,” as Wolfgang Arlt, director of the China Outbound Tourism Research Institute, has noted. “Many haveparents whodidn’t have shoes. Now they’re showing theworldand themselves: ‘I’m strong. I can go spend US$5,000 for nothing, just my pleasure.’” Yet, gambling is anything but exclusive to the Chinese, and PwC is not alone in recognizing that in Asia it remains vastly underserved. “Definitely, the success of Macau has set off a chain reaction in what is happening in the region,” says Francis Lui, vice chairman of Galaxy Entertainment Group. “You see more countries now assessing the pros and cons of having gaming as a driving engine for bigger economic growth.” The drivers, as you’d expect, are as varied as the region itself. At Entertainment City, the Philippines is taking the master-planned route. Taiwan is experimenting with something similar although on a much more limited scale. South Korea is dressing up the area around Incheon International Airport with tax breaks and other incentives. Even tiny Sri Lanka has entered the fray. And in Japan, a historically conservative political culture is shaking things up in Asia’s second-largest economy with the possibility that legalization will happen much sooner than anyone imagined. Mr Lui has put it succinctly: “The region is going to have more casinos.” A Continent on the Move