Inside Asian Gaming

INSIDE ASIAN GAMING NOVEMBER 2018 20 COVER STORY L ANDING International’s US$1.5 billion Jeju Shinhwa World opened its casino on 25 February 2018 and for the first half of this year reported gross gaming revenue of HK$2.4 billion (US$307 million), 50% more than the combined GGR for Jeju’s eight casinos for all of 2017. That’s a result worthy of a US$1.5 billion integrated resort, achieved under difficult circumstances. The challenge for Landing, and for Jeju, is to build on that impressive launch. Shinhwa World brings first-class gaming and visitor amenities to what’s already a top tourist destination, attracting 15 million visitors last year. A volcanic island off the Korean peninsula’s southwest coast, Jeju has a trio of UNESCO World Heritage sites, with Mount Halla, Korea’s tallest peak, at its center. Two and a half times the size of Singapore with a more temperate climate than peninsular Korea, Jeju is a lush green lung for urban dwellers with a network of hiking trails, dramatic vistas and dozens of conventional and quirky museums. Jeju is also home to half of South Korea’s 16 foreigner-only casinos and, as a special self-governing province, offers visa-free access for visitors from mainland China and nearly every other jurisdiction. It’s just a 55-minute flight from Shanghai, 1 hour 20 minutes from Osaka and within 2 hours 30 minutes of Beijing and Tokyo. With an effective tax rate around 15%, less than half of Macau’s levy, it can offer greater incentives to VIPs than many other jurisdictions. BLACK TO WHITE Yet last year, Jeju reportedly mustered GGR of US$200 million, just over 0.5% of Macau. Jeju has suffered from a reputation for so-called “black casinos” that don’t play honest across the board. One executive recalls joining a casino and finding surveillance didn’t extend to the counting room. In 2015, Jeju established a Casino Regulatory Division, affiliated with the police department. CRD “turned casinos from black to white,” one executive says, and gets high marks from the industry for its cooperative attitude. But in some circles, Jeju’s bad reputation persists. A recent hurdle is China–South Korea tension over deployment of the US supplied THAAD missile defense system last year to counter North Korean missile threats. China barred group tours to South Landing Casino