Oct 10, 2014 Newsdesk Japan, Latest News, Top of the deck
Japan’s draft law to legalise the principle of casino resorts would not include a provision to ban locals, reported Reuters news agency on Friday, quoting a “parliamentary source” that it did not identify.
According to earlier media reports from Japan, on October 7 the chairman of a bipartisan grouping of lawmakers set up to handle the IR [integrated resorts] Promotion bill (the first of two casino bills) suggested it might be watered down to make such resorts for foreigners-only.
The reported reason was to address the concerns of some opposition parties about a potential rise in gambling addiction.
Prime Minister Shinzo Abe has focused on casino resorts as an economic multiplier, creating jobs, bringing in foreign tourists and raising fresh tax revenue from gambling by overseas visitors. Opponents are concerned it could be mostly locals doing the gambling.
Japan, a nation of 128 million, had just 10.4 million inbound tourists last year according to the Japan National Tourism Organization. Tiny Macau, bolstered by its physical and cultural proximity to mainland China, had 29.3 million, according to official data.
Japan hopes however that the Summer Olympic Games in Tokyo in 2020 could help to double the annual visitor numbers. The government has talked previously of linking the launch of a casino industry to the games’ festivities.
But with as much as US$10 billion per resort being mentioned by foreign casino companies, and the current parliamentary session ending on November 30, time is running out to deliver one or more such complex projects in that timeframe. A second bill, covering the nuts and bolts of casino regulation, possibly including the fraught question of where they should be, is also planned for the legalisation process.
Union Gaming Research Macau Ltd said in a note on October 8 that a foreigners-only casino industry in Japan would be “a non-starter” in terms of attracting major international IR developers willing to deploy significant amounts of capital”.
Estimates of the potential size of a Japan casino industry in annual gross gaming revenue terms vary significantly among investment analysts. Most assume participation by locals.
Independent brokerage CLSA has estimated that just two initial gaming resorts – one for Tokyo and another for Osaka – could generate revenues of US$10 billion annually.
Neighbouring South Korea, which currently bars locals from all but one of its casinos and mainly caters for Chinese and Japanese players, had a market worth US$2.7 billion last year according to Malaysian financial research house CIMB Research Pte Ltd.
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