Navigating Uncertainty: The Complex Landscape of Japan's Integrated Resort Odyssey

Japan's foray into the realm of integrated resorts (IRs) unfolds as a saga marked by persistent ambiguity, featuring a narrative where fortunes oscillate, and the terrain ahead remains largely uncharted. While the anticipated opening of the first legal casino in the Kansai region in 2030 holds promise, the journey thus far has been defined by a constant ebb and flow, with each step leading into an enigmatic abyss.

The narrative of Japan's casino legislation is characterized by fervent highs and lows, a rollercoaster of optimism, bewilderment, exhilaration, and dismay. Amidst these fluctuations, steadfast advocates find themselves on the precipice of a story that at times mirrors the inscrutable.

Over 200 days have elapsed since the government granted approval for an integrated resort in Osaka, the second-largest municipality by GDP in the country. However, Nagasaki Prefecture's lingering application, coupled with the lackluster bidding contest featuring only two proposals for three available IR licenses, underlines the unpredictability of the Japanese IR saga.

Nagasaki's bid symbolizes a conundrum for the Japanese government. Granting a license to a less prominent city risks accentuating the waning allure of the Japanese IR industry. Simultaneously, denying it casts a pall over an already lackluster bidding contest.

The decision, or indecision, to defer Nagasaki's fate appears strategic, favoring the uncertainty of a no-win situation over a definitive lose-lose scenario.

Even for the MGM-ORIX consortium, the official endorsement of its IR implementation plan has not translated into swift progress. Groundbreaking on the IR site is contingent on the completion of ground preparation works, slated for 2025 at the earliest. A neighboring land plot, crucial for the Osaka World Expo, faces delays and soaring construction costs, echoing challenges seen during the Tokyo Olympics.

The escalating costs associated with hosting the Expo mirror a pattern observed with the Olympics. A contractual clause providing an "escape" for the IR consortium has fueled skepticism among the Japanese public.

The macro-political winds of change continue to steer IR legislation. Prime Minister Fumio Kishida grapples with historic low approval ratings, and dissent within his party compounds the challenges. With Kishida's tenure approaching a critical juncture in ten months, political headwinds further stifle the momentum of the Japanese IR industry.

The absence of key IR advocates such as Shinzo Abe, Yoshihide Suga, and most recently, Hiroyuki Hosoda, creates voids that complicate the fate of the remaining two IR licenses.

While Takeshi Iwaya, Koichi Hagiuda, and Yasutoshi Nishimura, among the original advocates, have assumed various roles, the lack of cohesive pro-IR leadership raises questions about the future trajectory. Hagiuda's rise within the LDP, particularly as policy chief, hints at a potential supporter for a Tokyo integrated resort in the future.

For now, Japan's IR journey appears ensnared in inertia, awaiting a favorable shift in the political landscape. Whether triggered by a snap election or the LDP leadership elections in September 2023, substantial change seems contingent on navigating the uncertain terrain of Japanese politics.

By fLEXI tEAM