Nov 30, 2012

Vietnam - Despite economic downturn, billions of dollars still poured into casinos

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VietNamNet Bridge – While the capital flow to investment channels has got stuck in the economic downturn, billions of dollars’ worth of capital still have been poured into casino projects.

Philip Falcone, the founder and President of Harbinger Capital investment fund, visited MGM Grand Ho Tram Beach, a component of the Ho Tram Strip – an integrated resort project capitalized at four billion dollars in the southern province of Ba Ria – Vung Tau.

The president emphasized that Harbinger has been pursuing the projects since the very beginning, and there has been no change in its commitments to develop the project in Vietnam.

Currently, ACDL (Asian Coast Development Ltd) is nearly completing the interior decoration for the first phase of MGM Grand Ho Tram Beach before it hands over the construction work to the investor in the next month, so that it can be operational by early 2013.

This would be a complex comprising of 541 rooms, a casino, conventional center, restaurants and high end shopping malls. All of the items would be located on a beach with 2.2 kilometers in long, surrounded by the forests.

In October, ACDL announced that it kicked off the second phase of the MGM Grand Ho Tram Beach project sooner than initially planned. A golf course is also under construction which would become operational the next year.

With the strong commitments by the investor and the speedy implementation, analysts say, the investors do not lack money and determination to develop investment projects in the crisis, and they would still pour money into where they can find profits.

In late October, when ACDL started the construction of the second five-star hotel tower sooner than initially planned, Lloyd Nathan, ACDL’s General Director, said on local newspapers that the opportunities are very big in Vietnam, even though at present, Vietnamese people are not allow to go to casinos.

The businessman said he can see a bright prospect for casino projects, because the demand is still very high in Asia, while the supply remains low. The main clients of Ho Tram would come from Asia, including China, Japan, South Korea, Thailand and Indonesia.

VOV has quoted an official from the Kien Giang provincial Planning and Investment Department, as saying that two investors have expressed their willing to make investment in casino project in Phu Quoc island in the province. The project is expected to cover an area of 135 hectares and to have 4 billion dollars in investment capital.

The joint venture of Bo Bien Vang Phuong Nam, headquartered in Phu Quoc island, with a Philippines-based investment group and Ngoi Sao Bien Tourism Company, has decided to join forces with a Hong Kong’s consultancy firm - Asia Strategic Consulting & Advisory Service Ltd – to register the project.

The two investors regularly contact the Kien Giang provincial Investment and Planning Department to ask for information and the Vietnam’s standpoint on their proposals.

One year ago, President and CEO of Las Vegas Sand Sheldon Adelson, sent words intimating that he wanted to develop a big integrated resort in Vietnam, which has the same scale as the Marina Bay Sands in Singapore, with the total investment capital of 6-8 billion dollars.

The president said in local newspapers at that moment that he would be ready to fly to Vietnam once he can receive “good signals.” However, there has been no “good news” since then. Meanwhile, Vietnam has reaffirmed its strategy that casinos would not be opened to Vietnamese citizens.

Linh Tu


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