Operator News
Thailand’s casino prospects gain approval from House of Representatives
By Phil - 2 April 2024
Thailand’s future casino industry moved a step closer with the House of Representatives signing off on its approval for the study advocating the birth of a legal casino sector. The proposals will now need to be voted in by the cabinet.
The support for introducing casinos was strong with the House vote seeing 253 of the 257 legislators voting in favour of the relatively low proposal of a 17 per cent tax on GGR. Other details include 20 year licences and thereafter renewed every five years. The larger resort complexes would need a minimum investment of US$2.7bn. The study pushes for different sized casinos to attract different levels of investment with the first wave of licenses to be launched to be for the largest resort complexes.
Thai Prime Minister Srettha Thavisin lent his support, saying: “It’s time for our society to stop hiding the gambling, which is out there, and just properly regulate and take care of it. I am not sure when the law will get approved and an entertainment complex can start operation. It will probably take some time. During the interim period, we need to tackle those illegal activities.”
Maybank Investment Bank believes that the first legal casino could open in Thailand in 2029 and sees potential for up to eight integrated resorts
Maybank IB analyst Samuel Yin Shao said “License bidders will be evaluated by a committee headed by the Prime Minister. We understand that favored locations are in the Eastern Economic Corridor (Rayong, Chonburi, and Chachoengsao), south (Phuket, Phang Nga, Krabi), north (Chiang Mai, Chiang Rai, Lampang) and northeast (Nong Khai, Udon Thani, Khon Kaen, Nakhon Ratchasima).
“These locations are also in the midst of building/upgrading their airports, ports and high-speed rail. The whole idea of economic corridors is to attract more tourists to Thailand. Assuming two years to finalize a regulatory framework and three years to construct, the first economic corridor may only open in 2029.”
The added competition would bring losers as well as winners with Singapore’s two casino resorts and Cambodia’s NagaWorld to be the most affected although they would have around five years to address the new players on the Asian block.
“We expect Genting Malaysia’s Resorts World Genting to be least impacted as less than 20% of their GGR is derived from foreigners,” Mr Yin said. “We are more concerned for Genting Singapore’s Resorts World Sentosa (RWS), where we estimate that around 60 per cent of GGR is derived from foreigners, and NagaCorp’s Naga 1 and 2 where almost all their GGR is derived from foreigners (only Cambodians who hold foreign passports can gamble in Cambodia).
“Yet, recall that many whom had believed that Malaysian GGR would fall after the Singaporean integrated resorts opened in 2010 were proven wrong.”
