A measure still pending is already shaking markets: the future easing of visas for Chinese tourists in South Korea, planned for the end of the third quarter of the year, has triggered an unusual rise in the stocks of casinos and hotels.
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The expectation of a torrent of visitors has driven Lotte Tour Development (operator of the Jeju Dream Tower complex, for foreigners only) up by more than 50% since January, including a monthly increase of 37.4% as of last Saturday.
During the same period, Paradise Co. registered an increase of 28% and Grand Korea Leisure 7%. Confidence is such that the colossal National Pension Service increased its stake in Lotte Tour from 5.01% to 7.05%.
Dependence on foreign players exposes sector’s vulnerability
But there is a crucial nuance: 18 out of the country’s 19 casinos only admit foreign players. Kangwon Land, in Gangwon province, is the only exception for South Koreans.
This dependence makes them vulnerable to political fluctuations, as demonstrated by the brief martial law decree by then-President Yoon Suk Yeol in December. Although revoked in just 6 hours, it deterred Chinese and Japanese tourists, according to the Korea Economic Daily, affecting visitor numbers at a critical time.
Tourism boom drives historic recovery in South Korea
This stock market boost is explained by the strong tourism recovery: more than 7.1 million foreign visitors arrived by May, the best figure since early 2020. China is the undisputed engine, contributing 28% of the total.
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The visa exemption promises to accelerate this trend. “If the policy is implemented, it will increase interest in traveling to Korea,” predicted Lee Nam-su, an analyst at Kiwoom Securities, anticipating direct benefits for key destinations with casinos such as Jeju, Seoul, and Busan.
Visa exemption exchange strengthens Korea-China relations
The South Korean measure does not arise in a vacuum. It is a response to a previous gesture by China, which since November has allowed visa-free entry to South Korean citizens (among others) until the end of the year. This exchange is seen as a bilateral thaw.
“Since visa-free entry for Koreans was allowed, there has been a good relationship,” noted Kim Hye-young of DAOL Investment & Securities, highlighting the potential for casinos despite the Chinese ban on gambling abroad.
The regional context reinforces this rapprochement: South Korea, China, and Japan recently agreed to strengthen their economic and commercial cooperation, an alliance considered increasingly crucial in the face of global instability.
South Korea’s gaming industry bets on Chinese tourists
As the visa measure moves towards implementation, the Korean Stock Exchange is already celebrating the expected massive return of the big players: Chinese tourists. The industry is betting heavily that this time, the recovery will be sustained.
