Japan Delaying Integrated Resort Timeline Comes as Little Surprise
Posted on: August 11, 2020, 01:43h.
Last updated on: August 11, 2020, 02:49h.
The Japan central government has confirmed it’s reviewing the possibility of introducing changes to its integrated resort (IR) time line because of COVID-19.
A leading analyst on the forthcoming gaming industry — once expected to be the world’s second or third largest behind on China’s Macau, and perhaps Nevada — says casino operators monitoring Japan likely weren’t caught off-guard by the announcement.
This week, Japan Minister of Land, Infrastructure, Transport, and Tourism Kazuyoshi Akaba said because of the coronavirus limiting travel internationally and domestically between prefectures — and many unknowns regarding the country’s near-term economy — a lengthening of the IR licensing process is being studied.
“Some IR operators who have partnered with local governments are in a difficult situation due to the impact of the new coronavirus, and there have been opinions saying that the future is uncertain,” Akaba stated at a press conference last week.
Government Delay, or Casino Pushback?
Japan has been viewed as the biggest new market opportunity since Macau was returned from Portugal to China. The People’s Republic Special Administrative Region (SAR) decided to end SJM Holdings’ monopoly on casino gambling and welcome in five additional operators in 2001.
The coronavirus, however, has halted much economic optimism. Las Vegas Sands, considered the world’s premier IR developer and operator, announced its withdrawal from Japan’s consideration in May. Wynn Resorts closed its Yokohama office earlier this month, and MGM Resorts said it would now be looking to be a minority investor in Osaka.
All three US-based casino giants, which hold three of Macau’s six concessions, were considered front-runners for Japan.
Considering the current global situation, there should not be any surprise in regards to recent operator and Japanese central government comments,” Joji Kokuryo, managing director of Bay City Ventures, told Casino.org.
Kokuryo is an advisor to the Gaming Standards Association of Japan. His resume includes stints working in Asia’s leading IR markets, including Macau and Manila’s Entertainment City in the Philippines.
“It is important to note that each IR operator has unique formulas and levels of interest in Japan. Currently, with a delay in Japan’s national time line on the horizon, international travel limitations, and the optics of having a Japan office when current markets are in the midst of recovering from closures, some gaming operators may decide that they do not require a full-fledged Japan office for the time being,” Kokuryo added.
The coronavirus certainly has stalled Japan Prime Minister Shinzo Abe’s wishes to make the country an IR destination. Kokuryo says the process of bringing commercial gambling to the country hasn’t been at “the speed many from the corporate world are used to.”
There have been multiple setbacks, some self-inflicted and some inevitable,” he continued. “The speed at which the central government can proceed will continue to be dictated by how soon financial, economic, and medical issues are first cleared up.”
“While things are definitely not on track as originally planned for IR development, the same could be said for any other kind of national project under the current circumstances,” Kokuryo concluded.
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