Proximity could make Vietnam, Philippines big winners
Singapore’s tight controls on junket promoters could be counterproductive for the country’s gaming market, according to a report in Forbes.
The island republic does limits play by locals by imposing a S$100 (US$76) casino entry fee on citizens for each casino visit; they also have the option of paying S$2,000 per year. The government also bans advertising to residents, and requires certain groups like overseas contract workers and civil servants to regularly report casino visitation. In the past five years, Forbes reported, the Casino Regulatory Authority has fined operators $2.6 million, mostly for marketing offenses.
Singapore welcomes foreign high rollers, however, taxing VIPs at just 5 percent versus 15 percent on mass play. But because the country resists junket operators, many high rollers who would otherwise travel to Singapore are going to other jurisdictions.
Though Singapore authorities continue to link junkets to organized crime and corruption, the Forbes report noted that jurisdictions outside Macau including Australia and Korea “haven’t descended into lawlessness and disrepute” because they permit junket operators.
Other jurisdictions are happy to benefit from the Macau exodus by catering to junket operators, who provide transportation, accommodations and lines of credit for their customers. Paradise Co. in South Korea, for example, is hiring Mandarin-speaking staff and offering free flights, limos and hotel stays to VIPs. Echo Entertainment Group Ltd. of Sydney and NagaCorp. Ltd. of Cambodia offer higher commissions, lower taxes and luxury travel to junket operators and their high-end clientele.
Aaron Fischer, a Hong Kong-based analyst at CLSA Ltd., told Bloomberg that Vietnam and the Philippines will likely benefit most from the Macau exodus “as they are the closest. Korea will pick up people in the northern parts of China.”
