September 9, 2016
In a draft decree this week, the Ministry of Finance maintained its stance that Vietnamese locals will be banned from casinos. Only foreigners and Vietnamese with foreign passports can use casinos.
The move will disappoint foreign investors who hoped the Vietnamese government would lift its local ban on casinos.
The Vietnamese press speculates that the ruling was based on social concerns regarding money laundering and gambling addictions.
Many were hoping that officials would just implement an additional entry fee for locals, similar to Singapore’s policy, or impose a minimum net worth requirement. It appears that was not the case. “On the surface, this [Monday’s news] is clearly bad news for international integrated resort (IR) developers who viewed Vietnam as one of the prized global greenfield opportunities,” said Grant Govertson, founding partner of Macau-based research firm Union Gaming Group, in a note. “It kills any interest for large gaming companies to invest in IR projects,” echoed Shaun McCamley, head of Asian operations at management consulting firm Global Market Advisors.
Due to its youthful and educated population, many were hoping it would become a bright spot for Southeast Asian gaming – especially given the recent downturn in Macau.
“Vietnam was viewed as a potential great investment opportunity should the government allow locals. Las Vegas Sands has been the most visible and vocal major gaming developer who has an interest in Vietnam,” pointed out Govertson. The seven licensed casinos currently operating in the country all rely on foreign visitors for growth.
The finance ministry has also remained staid in its $4 billion minimum capital requirement for foreign investors looking to run casinos.