VietNamNet Bridge – The Government should grant an exclusive license for casino operation to a big investor, or issue licenses to a limited number of foreign investors in order to successfully attract foreign direct investment (FDI) into this sensitive field.
This is the view of Cushman & Wakefield Vietnam, a leading real estate consultant, as feedback on the draft decree on casino management that the Ministry of Finance has recently submitted to the Government.
Mark D. Capasso, executive director and national practice leader of the Hospitality & Gaming Practice Group under Cushman & Wakefield Vietnam, said the chance for Vietnam to find investors would be higher if the number of licenses was limited, or the Government decided to issue an exclusive license to a big investor, rather than granting investment licenses en masse.
According to the draft decree, foreign investors must register a minimum capital of US$4 billion if wanting to open casinos in Vietnam.
Capasso commented: “Given the minimum capital required, there would be few chances for foreign investors if they did not develop recreation complexes.”
He said Vietnam should learn from the models of Singapore and Macau, where casinos are set up at recreation complexes according to the demand of the markets instead of the requirements of the government for investors.
Macau has chosen a number of investors to develop casinos and given a master license to Las Vegas Sands while in Singapore, an exclusive license has been issued to Las Vegas Sands. Both systems are operating successfully.
As per the draft decree, those wanting to get licenses for casino operation have to develop recreation complexes consisting of casinos. Local investors are required to have at least ten years’ experience of casino operation under Vietnam’s laws while foreign investors must observe foreign laws.
This provision will limit the number of foreign investors, but it will not be difficult to seek investors in the domestic market.
Regarding the provision that Vietnamese are not allowed to enter casinos, but foreigners or overseas Vietnamese with valid passports or laissez-passers are allowed, Capasso said this would affect earnings of investors.
However, investors do not find it strange. He said: “Investors should understand that in a certain institution, social control toward local residents is a must. Generally, investors have got used to such social controls.”
He added the Government should have measures to ensure sufficient demand for casino service even when social control is in force.
Leon Cheneval, branch manager of Cushman & Wakefield in Hanoi, said Ho Tram Strip of MGN was currently the only large-scale project that had earn the license for casino service, including 180 gaming tables and 2,000 slot machines. Other foreign investors like Las Vegas Sands and Donaco Singapore are also looking to invest in casino service in Vietnam.
This signals that giants are ready to be present, Cheneval stated.
Lloyd Nathan, general director of the Ho Tram Strip project, recently told the Daily that 40% of the revenue of Naga Corp., operator of a casino chain in Cambodia, came from Vietnamese.
Apart from Ho Tram in Ba Ria-Vung Tau, there are five other casino operators nationwide, namely Genting VinaCapital Co. in Hoi An, Silver Shores Hoang Dat Co. in Danang, Hai Ninh Loi Lai Co. in Quang Ninh, Royal International Co. and Lao Cai International Hotel, according to the finance ministry.
Recently, some foreign investors have expressed interest in opening casinos in Van Don, Quang Ninh and Phong Nha, Quang Binh.
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