Gangwon Land Struggles to Win Seven Luck
Casinos here are for Koreans or foreigners only. But even though people go there with the same hope of hitting the jackpot, this exclusive approach is now making a big difference.
Kangwon Land, the only domestic casino complex accessible to Koreans, has always been linked to negative images of corruption, bankruptcy, family collapse and gambling addiction. And it has been subjected to strict government regulations, citizen investigations, and media criticism.
However, foreigner-only casinos elicit a completely different response. They are considered tourist attractions and new sources of income
Foreign currency.
This unique image also produced different results in revenue.
Gangwon Land's sales fell last year for the first time since its establishment in 2000. The casino was established to help miners who were unable to import due to mine closures.
Last year, sales fell 3.7% year-on-year to 1.26 trillion won due to a decrease in VIP customers.
"Sales fell for the first time last year," said an official from Kangwon Land. "It is believed that negative reports on casinos and stricter regulations have reduced VIP guests' visits."
She said that after news reports that some senior government officials visited casinos, many people were reluctant to go because of fears that their visits might be made public.
Kangwon Land also suffered from various scandals.
The most recent incident involved employees who allegedly fixed the card game, which forced the casino to face police investigation and forced the facility to close for the first time for a day.
In contrast, eight casinos for foreigners in Korea, established by two major operators, Grand Leisure Korea and Paradise Group, are increasing in number of visitors every year and have made huge profits. Most importantly, they are free from ethical degradation.
GKL, which is 51 percent owned by the Korea Tourism Organization, currently operates Seven Luck casinos at the Millennium Seoul Hilton in central Seoul, another in southern Seoul, and three in Busan.
"Basically, people have different views on us and Kangwon Land," said an official from GKL. "They have a more positive image of us like exporters."
Currently, thanks to the Korean Wave, the number of foreign tourists from China and Japan is increasing. And they emerged as big contributors to foreign-only casinos.
An official at the Millennium Seoul Hilton also said that casinos have a positive effect on hotel sales because guests also stay at hotels and use facilities.
"Certainly, casinos bring us profits and serve as hotel attractions," the official said.
Paradise Group currently operates a total of five casinos, one each at Sheraton Grand Walkerhill Hotel in eastern Seoul, Hyatt Regency Hotel near Incheon International Airport, Paradise Hotel in Busan, Jeju Grand Hotel and Lotte Hotel Jeju. It also runs a casino in Kenya.
Market officials believe foreign-only casinos will post 9.4 percent annual growth, and their total sales, which reached $830 million last year, will surge 10.8 percent annually. 슬롯머신
This analysis has already been reflected in the stock prices of casino operators.
Shares of Kangwon Land closed 2.06 percent higher at 24,750 won on Friday, but edged higher on losses. The stock has stumbled over the past few months after hitting a high of 28,500 won on Feb. 7.
Meanwhile, GKL shares closed 1.3% lower at 18,500 won on Friday, but may remain stable as the stock has been on the rise since its Feb. 9 low of 18,500 won.
Experts said GKL and Kangwon Land have different prospects due to different target customers.
"With Kangwon Land already peaking, GKL is expected to attract more customers due to an increase in inbound tourists," said Han Seung-ho, an analyst at Shinyoung Securities.
