There are foreign companies still interested in investing in an integrated resort (IR) project in Japan if such opportunity arises, says Japanese scholar Toru Mihara (pictured) in an interview with GGRAsia.
“I think there are some foreign investors that are still interested in some regional markets, such as Hokkaido or Okinawa. Some companies still have offices in Japan, and they remain active there,” he stated.
Mr Mihara is a prominent commentator on Japan’s own casino legalisation process, and is chairman of a Japan body called the National Council on Gaming Legislation. He gave a presentation on Tuesday during the first day of the Global Gaming Expo (G2E) Asia 2023 Special Edition: Singapore.
Under existing legislation, up to three casino resorts were permitted nationally, with a deadline for submissions expiring in April last year. The national government received two bids: one from Osaka, in partnership with MGM Resorts International; and one from Nagasaki, which lists Casinos Austria International Japan Inc as a commercial partner.
In mid-May, the authorities in Nagasaki told GGRAsia they had no information yet on the timing of the national government’s decision regarding their application to host an IR.
There had been speculation in Japan that – because the quota of resorts permitted under the liberalisation programme exceeds the current number of applicant prefectures – a fresh round of applications could take place.
According to Mr Mihara, the central government can, seven years after the enactment of the implementation law, review the legislation, “in order to assess if its implementation has been good for the market, or whether they can introduce some changes”.
“If only one project is certified by the central authorities, it might be possible that the national government may change the interpretation of the current framework, so that it could be a bit more flexible for local governments to reconsider their position,” the scholar told GGRAsia.
Mr Mihara said initially he had recommended the creation of a two-tier system for casino resorts in Japan, which would allow for the development of large-scale integrated resorts, but also some smaller properties. “The central government was not in favour of such proposal, likely because it could result in a number of proposals from various prefectures,” he stated.
He added: “So, the decision, which likely was not the best one, was to set the same high requirements for all prefectures. While the central authorities might consider that to be fair, local governments at smaller prefectures might think otherwise.”
Regarding Nagasaki’s bid to host an IR, Mr Mihara said the consortium involved in that proposal could “collapse” if “nothing happens in the next six months”.
“I think there are some issues that need to be clarified regarding Nagasaki’s proposal, which have also been pointed out by the central government. We don’t know what they are, [but] most probably it has to do with the funding scheme,” noted the scholar.
“From the beginning, Nagasaki has never disclosed the name of its investors, not even to their own local diet [parliament],” he added. “The best way forward now, would be to disclose everything to the market. Let the market decide if [their proposal] is good or bad.”
There are currently no limitations regarding deadlines to assess an IR development plan, and the evaluation process regarding Nagasaki’s proposal “might continue for a few more months,” said Mr Mihara. “But I think it won’t be sustainable for more than six months,” he added.
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