Foreigners-only casino Paradise takes a dive
The government of South Korea plans to launch casino cruises that will allow residents as well as foreigners to gamble offshore. Currently, only one of Korea’s 17 land-based casinos, Kangwon Land, is open to locals.
According to the Asia Gaming Brief, the cruises will be ready to embark within the year, from various ports of call. The Ministry of Oceans and Fisheries says the government will establish docks exclusively for cruise ships in Busan, Incheon, Jeju and Sokcho, Gangwon by next year. Existing docks will be retrofitted to welcome the cruisers as well, according to the Korea Joongang Daily.
“If the discussed plans are pushed forward without any problems, we will be able to launch at least a single cruise ship carrying the national flag and reach our goal of 1.2 million cruise tourists by the end of this year,” Oceans Minister Yoo Ki-june said.
According to figures provided by the ministry, in 2014 the cruise industry served more than 1 million gamblers and won 1.22 trillion won (more than US$1.1 billion). In addition, the number of global cruise tourists is expected to grow to 37 million by 2020, up 43 percent from the 21 million recorded in 2013.
AGB reports that the government hopes to attract 3 million tourists by 2020 with the new cruises, which also will be open to foreigners. Currently Koreans are only allowed to play at Kangwon Land casino in Jeongseon, Gangwon.
An editorial in the Korea Times was critical of the cruise-ship plan, saying, “a number of Asian countries have made all-out efforts to promote the casino industry, which is often called the ‘golden goose.’ Kangwon Land’s sales nearly doubled from 810 billion won (US$750 million) won in 2005 to 1.5 trillion won last year, raising the possibility that there is still enough room for gambling on the part of Koreans. But it’s premature to allow Koreans entry into the floating casinos, given a plethora of anticipated social dysfunctions, including the mass production of gambling addicts.”
The editorial contended that paying for the social costs of gambling would amount to 78 trillion won a year. It also said 2 million Koreans, or just under 5 percent of the population, are gambling addicts.
Meanwhile, a major player in the Korean casino industry posted a marked drop in VIP traffic and net profit for the first quarter of 2015. According to GGRAsia, Paradise Co. Ltd. saw its net profit shrink 20.5 percent in the first quarter of 2015 to KRW40.5 billion (US$37.1 million). Revenue in the three months ended March 31 decreased by 11.2 percent year-on-year to KRW151.4 billion, Paradise disclosed in a filing. The decline was mostly caused by a fall in casino revenue, which contracted by 13.0 percent year-on-year to KRW131.2 billion.
Paradise currently runs five foreigners-only casinos in South Korea: one in the capital Seoul; one in Incheon near the capital’s international airport; one in the southern city of Busan and two on the island of Jeju.
