China's casino push losing steam in Australia

China's casino push losing steam in Australia
The Gold Coast Integrated Resort, a Chinese-backed $A6.47 billion project in doubt after political upheaval in Australia’s Queensland. (Photo by Evoke Communications)

SYDNEY - In Australia's Queensland, political uncertainty is clouding the 17 billion Australian dollars worth of Chinese-backed casino projects that have been in motion for over a year.

In 2013, the state government opened the door on the integrated resort industry, inviting developers bid on three new casino licenses. Queensland, whose economy is exposed to volatile energy markets, was hoping to pull down spiking unemployment and generate more revenue as the nation's resources boom faded. But plans for a rapid expansion of the gaming business appear to have ground to a halt.

Interest from Chinese developers was immediate. By mid-2014, there were four main groups looking to build: China's state-owned Greenland Group teamed up with Australian company Crown Resorts, while Chow Tai Fook and Far East Consortium sided with Crown's domestic rival, Echo Entertainment, battling for a license in the state capital, Brisbane. Hong Kong's Aquis eyed a license in the northern city of Cairns, while ASF Consortium, backed by state-owned giants China State Construction Engineering and CCCC Dredging, wanted to build a lavish casino and cruise ship terminal.

Unfavourable odds

Former Deputy Premier Jeff Seeney hailed the integrated resort tender as a "once-in-a-generation opportunity" to put Brisbane on the world stage. The government promoted the projects as a way to revive the tourism and construction industries. Yorkeys Knob - the remote former sugar cane-growing area where the resort is to be built - "is about to become the hotspot holiday destination of Cairns and Tropical North Queensland, now that the Fung family have been given the green light," according to a local tour operator's website.

Since then, however, the political landscape has shifted. The business-friendly Liberal government was punished in January's state elections by voters angry over plans to expand a coal shipping port near the Great Barrier Reef and the sell-off of state assets. The new Labor government has withdrawn support for ASF's $7.5 billion plans for Wave Break Island, citing local opposition.

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