Korea is looking at licensing five or six integrated resorts.

Korea could be the site of the next integrated resort boom.

GamblingCompliance reports that officials at the Korea Tourism Organization would like to see at least five integrated resorts on the order of the Singapore model. The government agency wants to see a bill debated in the National Assembly by late 2011 and a vote within the following two months.

The advisory board to the KTO will emphasize three elements in their push for IRs: enhanced tourism; new jobs; and turning Korea into a leading regional MICE destination.

There are a number of factors that could be spurring the present drive by the KTO.

The KTO website reports that in 2008 and 2009, Korea saw spending by foreigners increase by 81 percent and 20 percent, respectively. In 2010, partly because of a stronger won, spending by foreigners grew by only 4.8 percent.

Conversely, Koreans spending outside the country rose 15.4 percent to KRW20.3 trillion—about $18.4 billion. It was the highest level of annual spending overseas since officials began collecting data in 1970.

On the political front, the opposition Democratic Party scored a landslide victory in local by-elections last week. The result caused the heads of the ruling Grand National Party to resign from their party posts and could presage a change in government after next year’s national elections.

NTD Television reported that the GNP candidate defeated by Democratic Party leader Sohn Hak-kyu was regarded as having home-turf edge in a parliamentary seat outside of Seoul. Sohn is said to have chosen to run in the traditional GNP stronghold to make a point. He is now considered the front-runner for president among opposition candidates.

The key word for the by-election was “change” in people’s lives. According to NTD, recent surveys show that income distribution in South Korea has become more uneven.

This year Korea has also set out to increase foreign investment inside the country. A government committee set a target of $15 billion in foreign direct investment for 2011. That would be an increase of 16.6 percent over 2010 FDI.

In particular, the government is looking for investment from China, the Middle East and emerging economies in general. In March, the China Club was launched, a meeting of CEOs of Chinese companies with more than $1 million invested in Korea.

GamblingCompliance reported that a KTO advisory board spokesperson predicted the Korean gaming market could be at least four times that of Singapore, and more than 10 times larger than Korea’s current foreigners-only market.

Korea has 16 small casinos that are open only to foreigners and one at which residents are allowed to gamble, Kangwonland, in a more remote part of the country. News website Chosun Ilbo recently ran an article about Koreans who acquire foreign-permanent-resident status in other countries just to gain access to the foreigners-only casinos.

The issue of allowing locals to gamble will be crucial to the success of any new casino initiative.

Las Vegas Sands President Michael Leven recently said that although Japan is a priority in Asia, “Korea is at least as equal a target if we can get locals gaming in there.”

In a recent interview with the Korean Maeil Economy newspaper, Leven said LVS is prepared to invest $4 billion in Korea if locals are allowed to gamble.

“We want to create an integrated facility containing convention centers, businesses, theaters, entertainment and shopping,” said Leven. “Our focus is not just the casino. The Marina Bay Sands in Singapore is our best model.”

Of the three areas being discussed as resort sites—Incheon, Busan and Jeju—Leven said that LVS favored the land around the Incheon airport.

On partnering with local developers, Leven said, “LVS has sufficient financial resources to execute the project, but we would positively review any partnership offers from Korean corporations. One could imagine 15 percent - 20 percent stock participation in addition to constructing other cooperative relationships.”

The government advisory board is looking to develop a broad, non-partisan consensus among voters, in order to enable the Korean National Assembly to pass integrated resort legislation based on the Singapore model.

The legislation is expected to include entry fees and limits of 10 visits per month for locals, and tax rates similar to Singapore.

By Staff