Singapore Prime Minister Caustions IR's to Brace Themselves Until 2022
Published December 5, 2020 by Lee R
Can a new regulation regime in Singapore help the sagging formulas of its two massive IRs?
The top official of IR-heavy Singapore says the industry should brace itself for a couple years befoer any sort of normalcy returns.
PM Predicts Travel Shortfall
No less than Singapore's Prime Minister Lee Hsien Loong predicts international travel won't return to pre-COVID-19 levels until at least 2022—with major ramifications for major local Integrated Resort projects Marina Bay Sands and Resorts World Sentosa.
Wait Two Years
The 16-year Prime Minister told the Asia-Pacific Economic Cooperation (APEC) to expect a longer than hoped for return to normalcy for his iGaming economy.
“Travel is not going to return to normal next year. Maybe in two years’ time,” explained Lee to representatives of the United States, China, Japan, South Korea, Australia, and Canada:
“You cannot just go back to the old rules where you buy a ticket and within a few hours you get on the plane.”
Geo-political Communication Barriers
Lee identified the particular communication barriers that spring up when it comes to travel during the these times, centered around his belief that governments will continue jockeying to protect their own people:
“If I have more cases than you, you are afraid of me,” the leader declared. “Once you have that kind of relationship, it is very difficult to open up.”
The Market
As for the market performance, the Singapore Tourism Board reports the most recent quarterly report from Q1 reveals a drop in tourism spending of 39 percent; with international visitor arrivals down over 43 percent, and the hotel room revenue fall industry 31 percent.
Subsequent Quarters Worse
Considering that these figures are from the early arrival of the pandemic, these key IR industries have only likely sagged further—as Singapore's subsequent lockdowns across Q2 and Q3 means organisational performance figures for IR holders Las Vegas Sands and Genting Group will sag proportionally as well.
IRs Binding Agreement
That's because Genting and Sands both obtained licensing extensions through January 2031 requiring individual property investment of an additional $3.3 billion respectively into their properties.
Outlook
Lee's pragmatism was not supplemented with clear solutions, but undoubtedly a new regulatory regime incoming into Singapore for 2021 will be structured to address the contemporary challenges and keep Singapore's IR and gaming industry afloat.
