The Neighborhood Example

There’s nothing like your neighbor buying a new Mercedez Benz to egg you on into the arms of the nearest car salesman. In Asia, the nation-level equivalent of the “Keeping Up With the Joneses” game is in casino gambling. The huge pools of money piling up in Macau’s coffers is just too enticing for Asia’s leaders to ignore. So with the lure of tourism riches, countries throughout the region are removing the legal obstacles for casino industries to flourish.  

South Korea last year opened three casinos, bringing its total to 17. “South Korea plans to continue expanding into the casino market in order to compete with Macau and lure upper-tier Japanese customers,” says Tina Stehle, vice president of Agilysys, a Boca Raton, Fla.-based technology firm that works with casinos. South Korean newspaper Chosun Ilbo gushed earlier this year, “If 11 foreigners visit a casino, they will spend the equivalent of one exported car.” Globalysis says South Korea’s Jeju Island, which has eight casinos, could become “Asia’s next casino gaming giant.”

Taiwan confirmed last month that it’s considering allowing casinos — though PricewaterhouseCoopers last year predicted that gambling would be limited to a $600 million casino on Taiwan’s Penghu Island and forbidden elsewhere.

Japan’s ruling party is considering legislation to legalize casino gambling. “The Japanese public is becoming more tolerant of gaming and realizes the benefits of (casino) legalization, such as (an) increasing tourism market,” Agilysys’ Stehle says. The move would imperil Japan’s $250 billion-a-year pachinko business. Pachinko is a pinball game. It skirts Japan’s gambling ban because players exchange prizes for cash outside pachinko parlors.

PricewaterhouseCoopers expects gambling revenue in the Philippines to pass $1 billion in 2010 (up from $387 million in 2005) because the government is planning a big casino complex in Manila Bay.

Driving the regional interest in gaming: Asia’s rise from poverty to affluence. An Asian Development Bank advisory group predicts 90% of Asians will live in “middle-income” countries by 2020. That shift has created millions of consumers with cash to spend on entertainment.