Steep increases in minimum capital requirements for new and existing casinos in Cambodia, which were promulgated in late August and will take effect next month, are destined to greatly deter new investors from entering the Cambodian gaming market, said Larry Wong, former executive director of casino firm Jin Bei Group in an exclusive interview with Allin Media.
According to a decree signed by Prime Minister Hun Sen on August 26, the minimum capital for integrated commercial gambling centres will be increased to US$200 million and US$100 million for other casinos.
A grace period, which includes five phases over 15 years, has been given to existing casinos to meet the new capital requirements. Casinos that fail to comply with the new regulation will have their licences revoked.
According to Larry Wong, this new threshold was set too high and he believed not many firms in Cambodia were able to meet the new requirements. He added that even for Jin Bei Group, which is one of the major players on the gaming scene of the Cambodian costal gaming hub Sihanoukville, it was quite hard to find sufficient capital.
Wong did not rule out the possibility that some small casinos might find ways to bypass the new regulation, or the Cambodian government might grant some exemptions since the survival of small casinos was also important to the local economy in light of the Covid-19 pandemic.
The former casino executive pointed out that back in 2018 when the Cambodian gaming sector was in its golden age, there were over 150 casinos in Sihanoukville alone and about 300,000 Chinese citizens worked in gaming-related jobs in the coastal town. But both numbers were drastically decreased to less than 50 and 30,000 respectively due to the double whammy of a global pandemic and Cambodia’s online gambling ban.