Political Turmoil Drives Down South Korean Casino Revenue
The South Korean casino industry is feeling the impact of worldwide political turmoil in the form of lower revenue for Q1 2017. It’s a challenging situation that could get a lot worse as relations between South Korea, North Korea, and China deteriorate.
One of the biggest challenges for South Korean casino operators is that they must rely on foreign visitors for a good deal of their businesses.
Grand Korea Leisure, for example, is the country’s second largest casino that caters exclusively to foreigners. According to a report published on CalvinAyre.com, revenue at the facility for Q1 2017 was only $15.6 million (USD). That’s down a whopping 34 percent from the same period last year.
Industry observers peg that crash on a lack of visits from Chinese gamblers. This particular demographic is facing considerable scrutiny at home as the Chinese government continues to crack down on corruption. Other Chinese gamblers have been impacted by a lack of flights to Korea brought on by their government’s dissatisfaction with US government’s handling of relations with North Korea.
A similar dynamic was at play at Kangwon Land, the country’s only casino that caters to locals. Their revenue was down a full nine percent from the the previous year’s filings.
In this case, it’s very likely a case of prudent locals holding off on luxuries, such as casino gambling, while they ride out the country’s myriad of political issues. Besides the ongoing, and increasing, belligerence from their northern neighbor, South Koreans have also been dealing with internal challenges, such as the impeachment and arrest of President Park Geun-Hye.
Given the seriousness of the issues South Korea is facing, it may be a while before the country’s casino revenues bounce back.