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Vietnam – Reports link Hard Rock to Vietnam project

By - 16 March 2016

Reports out of Hong Kong claim that Hard Rock International and Banyan Tree are planning to build a casino resort in central Vietnam.

The Ming Pao newspaper, published in Hong Kong, quotes Hard Rock Vice President for Asian business development Daniel Cheng. He said the partnership was considering a US$100m investment in Vietnam to open a casino with up to 80 gaming tables and 500 slots.

The report said that Hard Rock was also looking at investment opportunities in Japan, South Korea, Cambodia and the Philippines.
Vietnam has been considering allowing locals to gamble in its casinos to make its potential more attractive to foreign investment.
Union Gaming Securities analyst Grant Govertsen believes this is critical if Vietnam is to attract major international casino operators. He also believes that casino tax would need to be lowered.

Mr. Govertson said: “It remains to be seen if a new draft decree will lower the effective tax rate further, which we believe would be necessary for Vietnam to complete effectively on a regional basis and attract world-class developers. in the context of a foreigners-only environment, we would expect the developers of the gaming portion of a project to want to limit their exposure to a reasonable dollar amount that would in all likelihood be significantly lower than US$1bn.

“Depending on whether or not the government is willing to settle for less, and in the context of the current China macro, it is hard to imagine a scenario where there will be significant international interest on the part of the major players unless an IR license [with local players allowed to gamble] is available for downtown Hanoi or Ho Chi Minh City,” he added. “The government will have to dramatically lower the minimum investment requirement [US$4bn] as well as lower gaming tax rates [set at 35 per cent] in order to be competitive in the region.”

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