Happy new year. At the start of last year, I made several predictions about the gaming business in Asia. Now it’s time to review how well my crystal ball worked. (When I’ve got it tuned, I’ll bring it to a baccarat table.)

Macau

 A year ago, I expected Macau’s gross gaming revenue (GGR) growth would be in the mid-single digits as it recovered from a 26 month slump. In reality, Macau’s GGR growth approached 20% in 2017, finishing at 19.1%.

Surprisingly, despite all the talk about and spending on non-gaming attractions to build Macau’s tourism and leisure appeal, this recovery has been powered by VIP revenue. Once 70% of Macau’s GGR, high roller play tumbled amid mainland China’s slowing economic growth and President Xi Jinping’s corruption crackdown. Yet, now VIP is driving the recovery.

That speaks to the other part of my Macau prediction, that recovery for its earnings will take years. Focusing on volatile, high volume, low margin VIP play makes Macau’s climb to its 2014 peak Ebitda levels even steeper. Higher margin mass play and non-gaming revenue would make up that ground faster, but most Macau operators still seem to see tourist appeal as a government imposed burden rather than an opportunity to realign their business and remake Macau. Moreover, few Macau casino companies seem able to appeal to both high rollers and the mass market. In other words, they still can’t walk and chew gum at the same time. I give the prediction a higher grade than I give most operators.

Philippines

In the Philippines, I expected the long anticipated sale of the government’s casinos, held through gaming regulator Pagcor, would dominate, with Caesars Entertainment, the U.S. gaming giant without an Asian presence, a prime candidate to buy them. That initiative, and President Rodrigo Duterte’s multipronged attack on online gaming, seemed poised to lead the news in what was the fastest growing casino market in Asia during Macau’s downturn.

Then in the early hours of June 2, a lone gunman entered Resorts World Manila and set fires that killed 37 people before taking his own life. Later that month, Kazuo Okada, the pachinko mogul who put his name on top of the biggest casino project in Philippine history, was ousted from the company he founded. Both events brought new turmoil to Philippine gaming, but, as with funds stolen from Bank of Bangladesh washing through Manila VIP rooms in 2016, there’s been little impact on the growth of casino revenue.

Improved relations with China under President Duterte have increased Chinese visitors. But insiders say a key reason for continuing growth is proxy betting, with high rollers wagering from outside the casino through junket agents, a practice barred in Macau. In sum, my prediction was wrong about everything except the continued strength of the Philippine gaming market.

South Korea

Caesars is one of three integrated resort licensees in South Korea, where I forecast a continued chilly outlook for development of all three US$1 billion properties approved for Incheon, near the nation’s gateway airport outside Seoul. Those casinos will be only for foreigners, since the government retains its ban on Korean nationals playing anywhere but remote Kangwon Land near the Winter Olympic site in Pyeongchang.

Korea’s first IR opened in April, Paradise City, a partnership between South Korea’s top foreigner-only casino operator Paradise Group and Japanese gaming machine manufacturer Sega Sammy. It soft launched with disappointing results into the added headwind of mainland China barring group tours over South Korea’s deployment of the U.S. provided THAAD missile defense system. Fuller ramp up won’t come until the middle of this year. Meanwhile, the other IR developers, Caesars and U.S. tribal gaming’s Mohegan Sun, keep promising they’ll start construction soon. As I said a year ago, they’ll need to see something positive from regulators or Paradise City to go forward.

I predicted India and Brazil as targets for new gaming development. In reality, India’s moves toward further liberalization of casinos have largely stalled , but Silver Heritage’s Tiger Palace on Nepal’s border with Uttar Pradesh opened just ahead of the new year. Spectrum Gaming likes Brazil as candidate for legalization this year. Call the prediction as a year early.

Southeast Asia

Finally, I forecast greater emphasis on Southeast Asia both as a market and a gaming development area. Beyond the Philippines and Singapore – where Las Vegas Sands’ and Genting Group’s extraordinarily profitable casinos have mounted comebacks – NagaCorp’s Naga2 extension soft opened in Phnom Penh in November, Vietnam is awash with new casino construction and proposals and Malaysia’s Resort World Genting is rolling out key features of its US$2.5 billion facelift. With Macau still largely uninterested in expanding its appeal beyond greater China, Southeast Asia beckons with 650 million people and dozens of gorgeous destinations. Call that prediction a winner.