Sri Lanka Hinders Crown Packer's Asian Expansion
James Packer's plans to enter the Asian market took a blow this week as the Sri Lankan government rejected his proposal to build a casino in the country. The chairman of Australian casino chain Crown Ltd. has already established a presence in Macau through a joint venture with Melco International Development and was aiming for further expansion in the Philippines, Japan, South Korea, and Vietnam. It was anticipated that his Sri Lankan project would move forward, but it seems the government has yielded to pressure from community and Buddhist groups, denying licenses to Crown along with two other prospective operators.
The Sri Lankan government sought to boost its tourism industry by 100% within two years, with a target of $2 million, as part of its efforts to rebuild after the conflict with the Tamil Tigers. However, it seems they were unwilling to face months of protests over the casinos. A large part of the backlash against the casinos has stemmed from concerns about a rise in crime and prostitution.
Afraid of Crime
Director of Hong Kong-based NGO, the Asian Human Rights Commission, Basil Fernando, stated that Sri Lanka is high on the list of nations with a deteriorating rule of law, and the public is fed up.
"There's a fear of a greater increase in crimes such as those related to black market money and illegal security forces, along with others, which has long plagued Sri Lanka," Fernando explained. "The primary apprehension stems from the deeper-rooted belief that in the last few decades, the rule of law has significantly disintegrated in the country, and rather than addressing this issue, the introduction of these hotel complexes would just be a cover to introduce more crime to the country."
Spreading Influence Globally
According to senior research analyst Brian Han from Fat Prophets, this development is not an insurmountable setback for Mr. Packer's ambitions.
"In Macau, he's constructing another property, so that will be his primary focus," Han stated. "There's also talk of him entering Tokyo - that would be a massive undertaking if approved, since it would cost $5 billion. Furthermore, he's looking at Sydney, where he'll enter the market in a few years; and of course, there's the US market. His goal is to spread his reach around the world, offering a highly appealing destination for premium high rollers visiting various cities.
"Simultaneously, he aims to focus intensively on the Asian region, where demand is growing rapidly and there's insufficient supply to satisfy it. Even if this fails, at least he'll have gained valuable insights into the regulatory process and identified his competitors."
The Sri Lankan government's decision is a significant reversal of their stance, as they had agreed to three resorts, sans the casino licenses, and had given developers substantial 10-year tax breaks.
Read also:
- Leverkusen claims victory in the cup, securing a double triumph.
- Alonso achieves a double victory after consuming a German brew.
- Does the SVolt factory in Saarland face stability issues?
- Furor surrounding Sylt scandal footage