A gathering of industry experts at last month’s G2E Asia expressed doubts about the growth prospects for the Philippines casino market, saying the Manila market is having more trouble attracting Chinese high rollers than anticipated.
The forecast doesn’t bode well for the destination-scale gaming resorts coming on line over the next few years at a government-sponsored tract of land on Manila Bay called Entertainment City.
Speakers pointed out that while the market expanded significantly when Resorts World Manila opened in 2009, it recorded growth of just 10 percent after Solaire Resort & Casino opened its doors last March as the first of the Entertainment City super-resorts.
Ed Bowers, head of global gaming development for MGM Resorts International, termed it a “potentially saturated market,” and Steve Rittvo, chairman of U.S.-based Innovation Group, said that like some other jurisdictions in the region there may have been an overly optimistic assessment of the potential to attract Chinese visitors.
Gaming revenues totaled US$2.2 billion nationwide last year, and CIMB is projecting growth of 9 percent this year. That could pick up to 14 percent in 2015, the firm said, the first full year after the planned opening at Entertainment City this fall of Melco Crown’s City of Dreams Manila. Revenue growth could slow to 6 percent in 2016, the firm said, despite the planned 2015 opening at Entertainment City of Universal Entertainment’s Manila Bay Resorts.
Despite the concerns, Melco Crown is confident about its prospects in the Philippine capital. “We think we can double the number of VIPs coming into the country,” said chief of international marketing Kelvin Tan.
Tan did, however, point out that the government needs to do more to improve relations with China, which have soured over a series of run-ins the last couple of years in disputed waters in the South China Sea. Chinese tourists to the country rose 70 percent last year and have the potential to rise further if the political issues are resolved and visa become easier to obtain.
Infrastructure is another big issue. Traveling through Manila’s Ninoy Aquino International Airport is difficult and the road layout and traffic congestion make the trip to Entertainment City from a lengthy one, as long as an hour, although the airport is not that far away.
A new highway is planned to bypass the surface roads and connect directly with Entertainment City, and a site for a new airport has been suggested farther south on land close to the Manila-Cavite Expressway, which offers a faster north-south route through the city.
