South Korea Gambling Revenue Tops $17 Billion in 2016
Posted on: March 6, 2017, 01:00h.
Last updated on: March 6, 2017, 11:01h.
South Korea gambling revenue surged in 2016 despite an economic downturn in the country. According to the Yonhap News Agency, the nation’s largest media outlet, revenue from the lottery, casinos, and horse racing sectors totaled 20.3 trillion won ($17.6 billion) last year.
That represents a 7.7 percent year-over-year increase.
Korean law prohibits its citizens from participating in most forms of gambling. Residents are allowed to enter only one of the 17 land-based casinos in South Korea, as the rest are foreigner-only facilities. Kangwon Land, a state-operated resort in Gangwon, is the only casino nationals can gamble in.
While 2016 was a good year for gambling, the South Korean economy has gone in a different direction.
“Due to economic depression, people tend to dream of making a fortune at one stroke,” Seoul National University Professor Kwak Geum-joo said.
Almost half of the country’s economy relies on the export of goods and services, primarily electronics and automobiles. But China has recently caught up in being capable of producing similar technological devices at lower prices, which in turn is driving demand down.
South Koreans are permitted to play the lottery, and also allowed to participate in the “toto,” pari-mutuel and fixed odds sports betting.
The Journal of Gambling Studies found in its 2012 report titled “The Effect of Recessions on Gambling Expenditures” that only lottery ticket sales were recession-proof. And in 2016, South Korea’s lottery rendered that theory true.
The lottery generated nearly $3.8 billion in revenue last year, more than nine percent better than its prior year performance.
Lottery’s growth outpaced the other legal gambling markets, as Kangwon Land increased 3.8 percent, and the Korea Racing Authority says its horse racing revenues grew just 0.2 percent.
While South Korea doesn’t appear to have any immediate plans to relax its strict anti-gambling laws for its people, the country is more than willing to welcome foreigners into gaming establishments.
This spring, the country’s 18th brick-and-mortar casino will open in Incheon. The city is part of the greater Seoul metropolis, which is home to roughly half of South Korea’s 50 million residents. Seoul is also the economic hub of the country, with both Samsung and Hyundai, the two largest companies in South Korea, both headquartered in the capital.
Paradise City is the first of three planned Incheon casino resorts. The foreigner-only property will feature a hotel and spa to compliment a 330,000-square-foot gaming space that includes 160 table games and 350 slot machines.
Sega Sammy Holdings is behind the project, the company famous in the US for its Sega video gaming system and Sonic the Hedgehog character. Paradise City is expected to open in April.
The next casino in the works is being partially financed by Mohegan Tribal Gaming, the US operator that owns Mohegan Sun in Connecticut and is currently in the process of developing another casino in the small northeastern state.
Parties investing in Incheon are hoping the region becomes Asia’s new Macau, or at the very least, becomes a viable alternative to the Chinese special administrative gambling region.
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