"A sheikh may come and lose $20 million." Interview with Ukrainian Gambling Association Vice President Vice President Oleksiy Yevchenko

Author

Nata Shtuka

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Ukrainian Gambling Association Vice President Oleksiy Yevchenko (center )

Last week, Ukrainian President Volodymyr Zelensky declared Ukraine would be allowed to open casinos in the country ’s five-star hotels. Ex-Finance Natalia Yaresko and Oleksandr Danyliuk (currently National Security and Defense Council Secretary ) had the same idea. But in vain. This time around, Zelensky’s initiative has lots of support, including by the pro-presidential-elect Member of Parliament majority. What will the re-boot of Ukraine’s gambling market look like? sat down with Ukrainian Gambling Association Vice President Oleksiy Yevchenko to find out.

- How many hotels are ready now be ready to open up casinos?

- If I heard Zelensky correctly, he suggested allowing casinos in five-star hotels. But not all of them have the necessary technical capabilities. Everything will depend on the requirements written into the draft legislation.

- What are requirements for casinos abroad?

- They vary. There are several gambling zones in the United States. The conditions there vary from state to state. As I recall, the minimum area starts at 1,000 square meters. There are also a minimum number of employees and so on.

- What determines the number of staff?

In the previous law, in 2015-2016, the cost of an annual license in Kyiv was $1 million. This figure needs to be multiplied by 3.5 to 4 to take into account the cost of premises and equipment.That 's the minimum cost for getting a casino up and running.

- It depends on the format of the casino. You can have one with only poker tables, or tables for online blackjack, or only roulette tables, or only slot machines. Their ratio will then dictate how many personnel are required in order to serve all this. The number of people in five star hotels differs from the number required in four-star hotels.

- How much should owners invest in their casinos?

- It depends on the size of the casino and the quality.

- And the minimum?

- Under the previous law (in 2015-2016), the cost of an annual license in Kyiv was $1 million. This figure should be multiplied by 3.5-4 to take into account the cost of premises and equipment. This is the minimum cost of entering this business.

- How long does it take to recoup your investment?

- It very much depends on where the business is located, how it is operated, under what conditions, the number and tourists it attracts, and so on. It ’s wrong to make any generalizations here.

- At least minimally.

- No one can answer definitively, if he understands what is at stake. A sheikh may come to you, lose $20 million in one night, and your casino will turn a profit in one day. Theoretically, this is possible, but almost never happens.

- Is operating a casino a profitable business?

- Profit margins are normal. It varies according to conditions of operation. It ’s wrong to generalize.

- How can legalization impact on today ’s market players?

- I think there will be a significant shake-up of the market. If the law is spelled out correctly, then, I think, national lotteries, so-called "sweepstakes " and the like face serious competition. And since now they are a hotbed of the spread of illegal gambling, the new law will force them to shut down on their own or the police will.

- What time is the illegal gaming shadow market valued at now?

- [ Interior Minister Arsen ] Avakov said at a press conference the figure of $300 million per year. I think this figure is significantly underestimated.

- What conditions need to be created for Ukraine ’s casino market to be successful?

- Firstly, the state should interfere in business as little as possible. If every inspector, tax specialist and law-enforcement official can intervene, the market will not work normally. Secondly, monopolization of the market cannot be allowed. It is necessary to allow world-famous players to enter Ukraine. Then there will be competition and additional investments.