The United Arab Emirates (UAE) is poised to make a significant impact in the global casino industry, with estimates indicating potential annual gross gaming revenues (GGR) of US$3 billion to US$5 billion. According to multinational investment bank and financial services company Morgan Stanley, the UAE’s unique positioning, boasting ultra-luxurious hotels and bustling international airports, provides a solid foundation for a thriving casino market that could rival established hubs like Singapore.
Market comparison and competitive edge:
Morgan Stanley has highlighted the promising aspects of the UAE’s emerging casino industry, drawing favorable comparisons with the highly successful Singapore integrated resort (IR) market. Major developments like the US$4 billion Wynn Resorts project in Ras Al Khaimah and potential ventures by MGM Resorts in Abu Dhabi indicate strong parallels with Singapore’s market dynamics.
The UAE is comprised of seven emirates, including Abu Dhabi, Dubai, Sharjah, Ajman, Umm Al Quwain, Ras Al Khaimah, and Fujairah.
In its thorough analysis, the investment banking company points out that despite having fewer millionaires, the growth in ultra-high-net-worth individuals in the UAE surpasses that of Singapore, indicating a market with high spending capabilities. The strategic geographic location, coupled with a higher population density and significant tourist influx, further enhance the potential for a robust casino industry.
Challenges and strategic considerations:
While the outlook is positive, the UAE’s casino market faces challenges, primarily regulatory and geopolitical. The absence of commercial gaming licenses is a significant hurdle, and the future landscape will depend on how the country in the Middle East regulates local participation and manages geopolitical risks. These factors will play a vital role in determining the long-term viability and stability of the market.
Morgan Stanley remains confident in the UAE’s ability to overcome these obstacles, potentially establishing more integrated resorts than Singapore’s current duopoly. They highlight the favorable gaming tax environment, with proposed rates between 10% and 12%, which could further enhance the market’s appeal, although this tax rate is yet to be finalized.
Impact on global gaming revenue: The potential growth of the UAE’s casino industry could have a significant impact on global gaming revenue, positioning the country as a key player in the international market. With the right regulatory framework and strategic management of challenges, the UAE has the potential to become a powerhouse in the global casino industry.
Overall, the UAE’s emergence as a formidable player in the casino industry is an exciting development that could reshape the landscape of the global gaming market. As the country navigates regulatory hurdles and explores strategic opportunities, the future looks bright for the UAE’s casino industry.
