Analysts welcome the moves, but say there is still some way to go for investors, including a lack of infrastructure and high charter capital requirements that are likely to mean that interest will be focused only on major cities.
So far, urban centres, such as Ho Chi Minh City, Hanoi, Da Nang and the surrounding provinces are targets for investment. “Investors in these locations benefit from higher levels of income among residents and also attract higher net worth tourists,” commented Maxfield Brown, manager business intelligence with consultancy, Dezan, Shira and Associates, said.
“Investors will benefit from rising wages and steady increases in gambling spending that is estimated to be growing by around 12 percent annually. The underground gambling market in big cities and tourist destinations will take a big hit as large investors displace smaller-scale underground operations,” he added.
The sports betting bill is set to come into effect from the start of 2019, although some football game bets were cleared from April 2018 to coincide with the FIFA World Cup.
The bill, passed by Vietnam’s National Assembly in June this year, followed that of a 2017 decree, which introduced a five-year pilot program setting out “strict conditions for firms involved in betting activities.”
According to Dezan Shira these include charter capital of US$44.2 million for horse racing and football and US$13.2 million for greyhound racing.
But the consultants noted there remains a lack of clarity in several areas, including categories of sports being included, and how the government will implement the bill’s guidelines.
The imposition of high capital requirements was seen as a deterrent to invest elsewhere in the country. “Rural locations with established underground gambling organizations and relatively low investment are not expected to see significant [activity],’ Brown said.
Foreign investors leading the charge to invest in the new betting climate include companies from Hong Kong, Singapore, South Korea and Malaysia.
Source: GMB / AG Brief
