Japan has given the green light to build its first casino in the city of Osaka, in a bid to boost revenue from domestic and international tourists, Reuters reported.
The project, approved on Apr. 14, will be a new avenue of tourism for Japan, according to Nikkei Asia.
The announcement comes as Japan readied itself to ease its coronavirus border controls in May 2023.
The project, with a starting investment of 1.8 trillion yen (S$18 billion), aims to generate an annual revenue of 520 billion yen (S$5.2 billion).
It will be a collaborative effort between the U.S. MGM Resorts International and Japan’s ORIX Corporation, and is forecasted to attract 20 million travellers, according to the Japan Times.
The 492,000 square metres complex will be built on Yumeshima, an artificial island in Osaka Bay located west of the city.
The integrated resort (IR) will consist of a conference centre, exhibition hall, hotel, theatre and the casino itself. It is expected to open in late 2029.
There will also be a shopping mall and ferry terminal on the island.
Japan is slated to host the World Expo at the same location in 2025.
Casinos and private gambling were previously against the law in Japan.
A law was passed in 2018 that allowed for the building of up to three IRs and exempted casino games at formally-approved premises, Japan Times and Reuters reported.
However, the public remained skeptical of using casinos to boost the economy due to the negative perceptions of gambling.
The casino plan also suffered delays due to the pandemic and a bribery scandal in 2019 involving a Japanese lawmaker, according to Kyodo News.
Competition in Asia
The approval to build Japan’s first casino comes as other Asian casinos grappled with their recovery in the post-pandemic, Nikkei Asia reported.
Popular gambling destinations like Singapore and Macau, which are popular with tourists from mainland China, struggled with China’s stringent zero-Covid policy before it was reversed in late 2022.
Genting Singapore, which operates Resorts World Sentosa, saw a net profit of S$340 million in 2022. However, this was still only 50 per cent of the level before the pandemic.
According to an associate professor cited by Nikkei, the IR in Osaka will be at an advantage as it will be able to thrive on largely domestic visitors in its early days.
Osaka is also located a short distance away from popular tourist spot Kyoto and is home to Universal Studios Japan.
Nevertheless, the casino will need to maintain its unique selling point in the long run to keep up with competition.
Top image via MGM Resorts International & Orix