Growth Stagnation and Japan's Mega Resort... Gangwon Land in Crisis, Sets Sail to Strengthen Competitiveness

Launch of Special Committee to Strengthen Complex Resort Competitiveness
Composed of 31 Members Including Industry-Academia Experts, Local Representatives, and Employees
Seeking Solutions Amid Stagnation in Sales and Visitor Growth

"Kangwon Land is now facing a crisis where even the domestic casinos, which have enjoyed a monopoly position in the country, are being forced into a competitive market system. We must face this harsh reality."

Choi Cheol-gyu Acting CEO of Kangwon Land
Photo by Kangwon Land

On the 29th, Choi Cheol-gyu, Acting CEO of Kangwon Land, emphasized this at the launch ceremony of the 'Kangwon Land Integrated Resort Competitiveness Enhancement Special Committee (Special Committee)' held at the Korea Press Center in Jung-gu, Seoul, stating, "While countries around the world are competitively investing to boost their tourism industries after COVID-19, Kangwon Land is losing its competitiveness due to aging facilities and illegal online casinos."

The newly launched Special Committee is tasked with deriving reform agendas and detailed plans to secure competitiveness in response to challenges in the domestic and international tourism industries, as Kangwon Land aims to become a global integrated resort. After assuming his role in December last year, Acting CEO Choi quickly formed a task force (TF) of 31 members, including tourism experts, regional representatives, and employees, and took the first step within about a month. This reflects the challenging internal and external management environment surrounding Kangwon Land and the reality that it faces threats to its survival.

Tourism industry advanced countries such as Macau and Singapore are intensifying their integrated resort businesses, including casinos, to attract tourists at all costs, and nearby Japan plans to complete a massive integrated resort worth 11 trillion won in key areas such as Osaka by 2030.

According to a report titled 'Analysis of the Impact of Japan's Integrated Resort Introduction on Domestic Casinos and Tourism Industry,' commissioned by the Korea Casino Industry Tourism Association to Professor Lee Chung-gi of Kyung Hee University’s Department of Tourism, it is projected that 670,000 domestic customers of Kangwon Land will shift to Japanese casinos annually once the Japanese integrated resorts open. In monetary terms, this translates to an outflow of 1.33 trillion won. The report also predicts that the total number of domestic travelers intending to use Japanese casinos among overseas travelers will be about 7.6 million annually, with an outflow amounting to 2.584 trillion won.

In contrast, Kangwon Land’s performance and the number of visitors to its casinos and integrated resorts have stagnated. According to the company, annual total sales peaked at 1.6946 trillion won in 2016 but declined thereafter, taking a direct hit from COVID-19 and dropping to 477.4 billion won in 2020. Although it recovered to 1.3875 trillion won (forecast) last year, this is still below the 1.5176 trillion won recorded in 2019 before the pandemic. The number of visitors also fell after 7.18 million in 2019 and only partially recovered to 6.8 million last year.

Members of the Gangwon Land Integrated Resort Competitiveness Enhancement Special Committee are taking a commemorative photo at the launch ceremony.
[Photo by Gangwon Land]

The Special Committee was formed starting from these concerns. Acting CEO Choi serves as chairman, with three subcommittees?External Policy, Casino, and Non-Casino?each comprising 10 members. They plan to announce detailed competitiveness enhancement measures by the first half of this year. Specifically, the External Policy subcommittee is responsible for creating and cooperating in a favorable external environment, including improving tourism infrastructure, collaborating with the government, and forming stakeholder alliances for developing tourism resources and products in mining-closed areas. The Casino subcommittee will conduct research on development plans centered on casinos and ways to strengthen competitiveness compared to overseas integrated resorts. The Non-Casino subcommittee plans to lead the development of facilities and content utilizing Kangwon Land’s pristine natural environment and create a resort that everyone wants to visit.

By the end of March, a public hearing and discussion forum will be held focusing on the tasks derived from regular meetings, and the 'Kangwon Land Competitiveness Enhancement Tasks for Leap to a Global Integrated Resort' will be announced after compiling opinions from related organizations and local residents.

Acting CEO Choi pledged, "For the sustainable growth of Kangwon Land, we plan to continuously cooperate with the government, local governments, and local residents based on the proposals of the special committee members. We will do our best to develop Kangwon Land into the best integrated resort in the country, lead the national tourism industry, and contribute to the revitalization of the mining-closed area economy."

This content was produced with the assistance of AI translation services.