The Incheon Free Economic Zone (IFEZ) Authority in South Korea is aiming to expand its “cluster” of resorts including casino facilities, which could act as international tourist attraction in its own right and counter the competitive threat of the coming Japan casino market.
So said a South Korean official, the zone wants to attract a further two to three schemes, to add to the one already operating and the four that are currently slated.
Macau, and the Las Vegas Strip – in Nevada’s gambling hub in the United States – already respectively offer one-stop destinations for casino entertainment. Japan has decided on a different course for its first phase of market liberalisation, despite one consultancy advocating an “Osaka Strip” of gaming properties in that Japanese city. Japan prefers to spread a maximum of three resorts around that nation.
“Our strategy” for countering Japan’s competitive challenge would be to provide at IFEZ “more diverse experiences and concepts” via an “IR cluster,” said Nicholas Kim (pictured), referring to the term integrated resort or “IR” used in the country and across the region to describe large-scale casino complexes with facilities such as conference space, hotels, shops and entertainment arenas.
The official, project manager, service industry division at the IFEZ Authority, was speaking to us on the sidelines of the Global Gaming Expo (G2E) Asia @ the Philippines casino trade exhibition and conference held in Manila last week.
IFEZ’s effort centres on Yeongjong Island, the home of South Korea’s main air hub at Incheon.
While South Korea already has a casino industry, of the 17 existing venues, only one – Kangwon Land – can accept local players. Casinos at IFEZ resorts will also be only for foreign players.
IRs anticipated in neighbouring Japan – currently an important source market for players in the South Korea casino sector – will be able to serve local players: albeit that nation might not have working resorts until the mid-2020s at earliest, and they will have restrictions including a locals’ levy and monthly visit limits for domestic players.
A number of investment analysts has suggested that South Korea’s preference for barring locals from most of its casino industry venues might be a hurdle for fresh international investment, in a region with a growing number of such projects. Investors in IFEZ would need as a starting point to inject at least US$600 million per casino complex.