A local referendum on plans to build one of more casino resorts on Taiwan’s Penghu Islands is likely to happen in April or May this year, according to the Taipei Times.
It follows the vote by Taiwan’s legislative assembly last week to approve offshore casino resorts in principle.
“Whenever a gaming initiative is introduced there’s always opposition,” said Michael Treanor, chief executive of London-listed AMZ Holdings, in an interview with the newspaper.
AMZ, which has been advised by former Las Vegas gaming boss Larry Woolf, has spent several years acquiring land on a coastal strip on Penghu’s main island to form a plot big enough for an integrated resort.
“Oftentimes it’s misinformed people thinking that with gaming may come social evils. But that is not always the case. It has been the case in certain circumstances, but not if done right,” added Mr Treanor.
His colleague Carl Burger, AMZ executive director, said: “It is our understanding that two previous referendums went through. There have also been a number of polls and in actual fact we did our own survey just over a year ago and it was well in favour of having gaming. There’s a place for the opposition because they’re the guys that keep everybody honest.”
Mr Treanor added: “We think that Taiwan, which is following the Singapore model for development of integrated resorts, is approaching it in a very responsible manner, which is to make them family friendly and not make gaming the centerpiece.”
The Taiwan authorities have indicated they expect casino developers involved in Taiwan to be heavily capitalised. This in theory appears to rule AMZ out as a main player. However, under current market conditions, heavy capitalisation is probably wishful thinking even for some of the world’s biggest gaming operators.
“Clearly the big operators are in trouble at the moment,” stated Mr Burger.
“They’re pulling back from projects and [Penghu] will probably require a multi-focus approach in terms of joint ventures. This is what you’ve seen in Singapore when joint ventures were formed for bidding and that’s probably what you’re going to see here in the current economic climate,” suggested Mr Burger.
AMZ, which is listed on London’s small to medium cap Alternative Index Market, says it has a team with experience of raising cash for projects, but stresses it will court a big name partner for Penghu.
“Being realistic, it’s likely Taiwan is going to want a name brand operator for its first few casinos,” said Mr Treanor.
“So for that reason, we will be in discussions with major international operators because we think the winning bidder will need land to build on as well as [having as a partner] a marquee operator.
“What we’re committed to doing is assembling a package that has a marquee operator and a piece of land that is ready to go and meeting any other criteria as best we can,” he added.
Mr Treanor stressed his company wasn’t deterred by relatively limited infrastructure on Penghu and the competition from Macau, the world’s biggest gaming jurisdiction by gross gaming revenues.
“Macau’s proximity to China is a double-edged sword,” said Mr Treanor.
“It’s great when visas are being granted to Chinese and that certainly was the engine pushing economic growth up until recently. But then visa restrictions were imposed and operators are suffering tremendously and having to scale back, if not cancel projects. Taiwan has 23 million people and no travel restrictions. It sits in the centre of South Asia [sic] and is just a short-haul flight from many major Asian cities, not just Chinese cities.
“It’s our opinion that if only Taiwanese nationals patronise the casino resorts that they will do very, very well. In addition it can be expected that you will have people coming from other jurisdictions,” stressed Mr Treanor.
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