Korean casinos could suffer if Japan ends gambling ban

Other Asian countries such as Taiwan and Singapore have also launched plans to establish casinos open to their populations in order to boost their economies. The KCA said such casinos would further weaken its revenue stream.

In Japan’s case, the difficulty of trying to deal with two decades of financial indiscipline has prompted its regional authorities to break one of the country’s great taboos ― gambling. With over 47 % of the estimated 1.68 million people that flock to Korea’s foreigner-only casinos Japanese, Japanese plan to end the ban on casino gambling will deal a significant blow to Korean casinos, according to the KCA.

Reports released by the KCA estimate a loss of approximately us$ 683 million in revenue. If laws to end the ban on gambling pass, gambling resorts are being considered in Osaka, Tokyo, and Okinawa.

It is estimated that over 2,100 illegal casinos operate in Japan generating about us$ 11.8 billion each year. Appreciating its potential as a money making enterprise, the Japanese government has been keen on softening its stringent gambling laws.

Japan’s official position on gambling has been contradictory for years. Betting is legal on horse, bicycle and power-boat racing within tightly controlled contexts, and the country has a national lottery. Because of its ban on casino gambling, Japanese tourists have relied on Korea. And despite a drop in revenue from Japanese gamblers in Korea ― due largely to the global recession ― it is believed they still remain the local gambling industry’s top draw.

Another concern raised by KCA officials was the high probability of runoff revenue going to Japanese casinos from the pockets of Korean gamblers. Industry experts predict a mirror effect with Korean tourists heading over to Japan if casinos begin popping up there.

Macau, which has overtaken Las Vegas as the world’s biggest money-making gambling haven since 2006, has long been the choice destination for Korean gamblers. The KCA said Korean tourists oftentimes opt to seek casinos overseas since local gambling laws place a cap on the amount of bets and visits that can be made.

As a preventive measure, the KCA called for the deregulation of local gambling, which would allow casino developers to build multi-purpose gaming theme parks to ensure the industry continues to grow.

On the negative stigma that comes with gambling, the KCA said such gaming resorts would be developed modeled after Las Vegas ― to make an enterprise widely perceived as illicit more accepted.