Japan Rejects Integrated Resort Plan for Nagasaki

Posted on: December 27, 2023, 10:59h. 

Last updated on: December 27, 2023, 12:22h.

The Japanese national government’s expert panel on integrated resorts (IRs) has rejected Nagasaki Prefecture’s plan to develop a casino resort in Sasebo. It was the expected outcome, given the extensive delays in considering and approving the project following the approval of Osaka’s plan earlier this year.

A photo of the Huis Ten Bosch theme park in Sasebo, Japan, where the proposed Nagasaki IR was to be located
A photo of the Huis Ten Bosch theme park in Sasebo, Japan, where the proposed Nagasaki IR was to be located. The Japanese central government has rejected the prefecture’s plan. (Image: Fukuoka Now)

The panel, which was formed by members of the Ministry of Land, Infrastructure, Transport and Tourism (MLIT), cited concerns about the project’s funding in rejecting the proposal. It also highlighted the lack of a clear commitment to preventing gambling addiction.

The panel said it wasn’t convinced that Nagasaki had sufficient funding to support the project. It also expressed concerns that the project’s proposed location, adjacent to the Huis Ten Bosch theme park, would attract enough visitors to generate the economic benefits that the prefecture projected.

Back to the Drawing Board

Nagasaki had proposed a JPY438.3 billion (US$3.07 billion) investment in the project, which would have included a casino, hotel, and shopping mall. The prefecture partnered with Casinos Austria to develop the project.

Throughout the process, there were doubts over where the money would come from. Nagasaki and Casinos Austria stated that they had promises of backing from major global financial institutions. But those promises weren’t enough.

In addition to the funding concerns, the panel also expressed concerns about the project’s proposed casino operations. The panel said the prefecture hadn’t provided enough information about how it would prevent gambling addiction and protect the public from the negative impacts of casino gambling.

The decision is a major setback for Nagasaki, which had been hoping to become one of the first three prefectures in Japan to open a casino resort. The prefecture had been working on its plan for several years and had invested a significant amount of time and money in the project.

Nagasaki May Have Another Shot

The failure of Nagasaki’s plan leaves only one prefecture, Osaka, with a plan to develop an IR. Osaka’s plan, which is being developed in partnership with MGM Resorts International, is expected to cost JPY1.08 trillion (US$8.1 billion) and attract an estimated 20 million visitors a year. That property could open in 2030.

Despite the rejection, Nagasaki hasn’t given up hope of developing an IR. The prefecture says it will review its plan and correct the problems the panel singled out.

The prefecture has also said that it will continue to work with the government to develop a regulatory framework for IRs that will protect the public from the negative impacts of gambling. Japanese officials say there may be a chance for additional IRs in the future, which means Nagasaki might have another shot if it can prepare a more satisfactory proposal.

The government, in response to public criticism, might consider limiting the number of IRs to protect the environment. It also wants to ensure that they are located in areas that can accommodate the large number of visitors they are expected to attract.