Yoon Tae-hwan, professor at the Department of Hotel and Convention Management at Dong-Eui University, delivers a keynote speech on the need to develop Korean-style integrated resorts during The Korea Times Global Business Club at Korea Press Center in Seoul, Wednesday. Korea Times photo by Shim Hyun-chul

As the casino industry shifts from speculative ventures to a broader tourism-focused model, experts recommend that Korea bolster its competitiveness by enhancing its integrated resorts.

Yoon Tae-hwan, a professor at the Department of Hotel and Convention Management at Dong-Eui University, emphasized the need for strategic development of integrated resorts while addressing key challenges during the Korea Times Global Business Club meeting, Wednesday.

In a keynote speech, he outlined the transformative role integrated resorts are playing in Asian countries and stressed the importance of Korea establishing distinctive strategies to remain competitive in the evolving tourism landscape.

Integrated resorts are becoming key players in the modern tourism industry, blending casinos with a diverse range of attractions in one destination. They are driven by revenues from high-income sources like casinos, which are used to support lower-profit amenities such as hotels, restaurants and cultural venues.

While casinos generate the bulk of profits, non-gaming elements like exhibition centers and dining options are crucial in shaping a resort's public image, according to the professor.

"These non-gaming features are essential in crafting a resort's identity," Yoon said.

Unlike traditional casinos that focus solely on gambling, integrated resorts aim to attract a wider audience by incorporating business facilities, family-friendly activities, leisure options, shopping and entertainment. This comprehensive approach enhances the overall tourist experience, attracting both domestic and international visitors.

Yoon Tae-hwan, professor at the Department of Hotel and Convention Management at Dong-Eui University, delivers a keynote speech during The Korea Times Global Business Club at Korea Press Center in Seoul, Wednesday. Korea Times photo by Shim Hyun-chul

Yoon highlighted the growing importance and interest of integrated resorts across Asia, citing examples from Singapore, Macao, Thailand and Japan.

"Countries like Singapore, Macao, Thailand and Japan are rapidly advancing their integrated resort strategies to boost tourism and diversify their economies," he said.

Each country shares a focus on ensuring domestic safety measures while attracting investments in non-gaming facilities.

In Singapore, the government has leveraged casino license renewals to drive investments in non-gaming infrastructure, attracting a steady influx of international visitors. At the same time, it has introduced stricter regulations to safeguard residents from gambling-related risks, striking a balance between tourism growth and public protection.

Macao, historically recognized as a gambling hub since the 1960s, has transformed into a major tourism and entertainment destination after allowing foreign investments in 2002. The city has experienced a significant increase in tourism revenues, and the government is now using casino license renewals to encourage further investments in non-gaming attractions.

Thailand, meanwhile, has moved swiftly toward developing its own integrated resorts. Following initial steps toward legalization last year, public support for the initiative has soared, with 80 percent of Thais in favor of the move.

The country's first casino is expected to open by 2029, as the government works to lower barriers for investors and expedite development.

Japan, which enacted a law on integrated resort development in 2016, has also taken comprehensive measures to ensure its resorts provide more than just gambling. Osaka's integrated resort, approved in April 2023, includes strong safeguards for local residents and aims to drive investments in a range of tourism-related facilities, setting the stage for a new era in the country's tourism sector.

Yoon also noted that Japan's upcoming development of integrated resorts is expected to present a significant challenge to Korea's casino and tourism industries.

Currently, 70 percent of customers at Korea's foreigner-only casinos are Chinese and Japanese visitors. With Japan preparing to open its own integrated resorts, Korea is likely to experience a significant decline in these key demographics, intensifying competition for tourism revenues.

An additional concern is the potential outflow of Korean tourists to Japan, which could further erode Korea's tourism competitiveness. This loss of domestic clients could lead to a substantial economic drain, weakening Korea's position in the regional tourism market.

According to a 2018 analysis by global credit rating agency Fitch Ratings, while Japan's integrated resort development may have a limited impact on Macao, it could considerably harm the casino industries in Korea and Russia.

The Korea Casino Association also reported that 48 percent of domestic casino patrons and 35 percent of the public expressed interest in visiting Japanese casinos once they open, potentially resulting in a loss of 7.7 million visitors and an annual revenue decline of 2.76 trillion won ($2.4 billion) for Korea's tourism sector.

To enhance the competitiveness of integrated resorts in Korea, Yoon stressed the importance of expanding non-gaming facilities to attract a broader range of visitors.

"Korea needs to develop unique, Korean-style integrated resorts that combine regional culture and identity, differentiating themselves from international competitors," Yoon said.

He also emphasized the creation of key anchor facilities that connect with other tourist attractions, forming a cohesive tourism ecosystem that strengthens local branding and image. These integrated resorts should act as symbolic landmarks, reflecting Korea's rich cultural heritage.

However, significant challenges remain.

Yoon highlighted the need to address the negative societal perceptions surrounding casinos, a crucial step toward gaining public support for integrated resort development.

"Reforming the legal framework governing casinos and enhancing regulatory oversight are also necessary to create a safer and more appealing environment for tourists," he said.

Furthermore, resolving barriers to large-scale foreign investments is essential for securing the capital needed to build competitive integrated resorts that can compete on the global stage, Yoon added.