Taiwan elections are a negative for gambling prospects, Union Gaming

Sunday 17th of January 2016

Taiwan has elected a new president, Tsai Ing-Wen of the the nationalist Democratic Progressive Party (DPP), which will also be in control of the legislature. According to Union Gaming, the results are likely to be a negative for gambling prospects in the country.

Foreign investors will find the decision to develop an integrated resort in Taiwan to be unpalatable, the Union Gaming report says, for both political and economic (demand) reasons. Taiwan’s new President Tsai has previously gone on record as being anti-gaming, and also instructed DPP legislators back in 2009 to vote against a bill to allow gaming referendums.

In terms of demand, in May, 2015 “mainland authorities ruled out the possibility of its citizens being allowed to gamble in Taiwan" at a time when talks of casino development in Matsu was heating up. Union Gaming believes with the new ruling party, seen as “more independent” than the previous pro-China party, there is even less of a chance of this decision to reverse.

Union Gaming believes the Macau Big 6 will not likely participate in a Taiwan Request for Proposals for three important reasons: 1) given that China policy is so important in Macau, no operator will dare risk negative attention from Beijing, 2) Chinese VIP story is radically different than years past, and 3) the explicit forbidding of mainlanders to gamble in Taiwan already tells a weak demand story, as well as a potential to upset Beijing.

Even non-Macau regional operators will likely shy away from developing IRs in Taiwan unless the Mainland stance towards gambling in the country changes, the report continues.

In the best case scenario, that IR development receives the go ahead, Union Gaming suspects gaming is “at least five years away when considering the need for implementing legislation, the RFP process, and the construction process.” “Further, we would not expect more than one or two IRs to be developed."

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