Japan’s first casino to have no impact on SAR’s gaming ops: expert
The approval of Japan’s first license to operate a casino will not have a direct impact on the city given the difference in its target market.
MGM Resorts International was granted a license late last week after the government approved the controversial plan to open the country’s first casino in the city of Osaka as the Japanese government seeks to lure more foreign tourists.
The resort will be operated by Osaka IR KK, established by the Japanese subsidiary of U.S. casino operator MGM Resorts International, Japan’s Orix Corp. financial services group, and a number of regional investors.
“We don’t believe there will be much direct impact as Japan is likely to go for the VIP segment, which Macau no longer targets,” said Ben Lee, managing partner of IGamiX Management & Consulting to the Times.
Macau’s gaming operators have been focusing on targeting the mass market, particularly after the crackdown on junkets that brought VIP clients to the city’s casino floors.
Although the gaming sector of the region is recovering after nearly three years of low profits, there remains some anxiety about whether the VIP and premium market will ever return.
It is unclear whether Beijing will allow these visitors frequent visits, which was the case before the pandemic.
Currently, gaming concessionaires are required to diversify their non-gaming elements as part of its pledge to the government and as required in their contracts following the recent massive overhaul of the SAR’s gaming laws.
Meanwhile, Lee said, “The Japanese have previously said they do not want to be swamped and will target the upper tier Chinese.”
Pre-pandemic, Chinese visitors to Japan have been growing. Official figures show that in 2019, there were 9.6 million arrivals from the mainland.
The number of Chinese tourists has increased four-fold from 1.4 million in 2012 to 7.4 million in 2017, overtaking South Korea as the biggest source market. In 2018, they numbered more than 8.3 million.
