Inside Asian Gaming

41 40 Regional Briefs Kazakh Casinos Sidelined Kazakhstan introduced a law in January to end gambling in big cities by March 31,and casinos and slot-machine arcades in the commercial capital, Almaty, have virtually disappeared. Casinos may now operate only in two small resort towns: Kapshagai, which is near Almaty, and Shchuchinsk, close to the capital Astana. “Out of 100 places that we checked [in Almaty], 99 were closed,” Zhanat Tastemirova, deputy head of Almaty’s tax committee, said at the beginning of April.“We continue inspections on a daily basis.” Casinos mushroomed across Almaty and other ex-Soviet cities during the 1990s and many were accused of acting as channels for money-laundering. Russia has proposed similar restrictions on gam- bling which have yet to come into force. Pagcor in Talks with Greece’s Loutraki Casino The Philippine Amusement and Gaming Corp (Pagcor), the country’s state-run monopoly casino operator, said it was in talks with Greece’s Loutraki Casino, which wants to bid for the right to develop a prop- erty in the first phase of the government’s planned 800-hectare gam- ing project on a site of reclaimed land in Manila. The project, called Bagong Nayon Pilipino Entertainment City, is envisioned to be a total entertainment complex, complete with casinos, resorts, restaurants and a theme park. The government hopes to draw US$10-billion worth of invest- ment into the first phase of the project covering 42 hectares, accord- ing to Pagcor chairman Efraim Genuino.“Loutraki is the biggest gam- ing operator in Europe. It’s from Greece,” said Genuino, who expects development of the first phase to be completed in two to three years. Pagcor, which currently operates 13 casinos nationwide, is the big- gest source of government income in the Philippines after taxes. Taiwan Casino Report Taiwan’s Council for Economic Planning and Development (CEPD) will release a report in six months on whether the country should lift its ban on casinos in a bid to boost local tourism. CEPD Vice Chair- man Chang Ching-sen said a debate on the issue has been going on for more than 10 years and that the CEPD will present its report and make related recommendations. Noting that originally the debate centered around whether ca- sinos should be built on outlying islands such as Penghu, Mr Chang said the CEPD is likely to broaden the scope and consider whether casinos could also be built in impoverished areas of mainland Tai- wan itself. Mr Chang noted that Singapore lifted a four-decade ban on casi- nos in 2005 and allowed the construction of two casino resorts in the hope of bringing in more tourists and revenue from overseas. “The final answer to the question of whether Taiwan should allow casinos will depend on public opinion and will hinge on the Legislative Yuan’s decision,”he said. Casinos Along China’s Border Decimated The number of foreign casinos operating near China’s borders fell from 149 in 2005 to 28 in 2006 as China stepped up efforts to prevent its citizens from going across its borders to gamble. According to the Ministry of Public Security, the measures imple- mented by China include harsher penalties, the closing of represen- tative offices of foreign casinos in China, and the closure of under- ground institutions used to transfer money overseas for gambling. The ministry worked in conjunction with local police in border areas in Yunnan, Guangxi, Heilongjiang and Jilin to carry out surveil- lance of nearby casinos and their customers. Chinese officials claim to have carried out 347,000 actions involving 1.1 million people in its anti-gambling drive in 2006. China says it also retrieved Rmb3.56 bil- lion (US$445 million) of illegal betting money last year. Earlier reports estimated a total of Rmb600 billion (US$75 billion) was gambled away annually by Chinese overseas – 15 times greater than the amount spent each year on China’s state-run lottery. NBA to Play in Macau Las Vegas Sands Corp’s Venetian Macau Resort Hotel, slated to open in July, will host the first NBA event to be played in Macao. The NBA China Games 2007 will feature the Orlando Magic playing the China Men’s National Teamon October 18th.On October 20th,theMagic will face off against the Cleveland Cavaliers. Both games will be played at Venetian Macau’s new 15,000-seat arena. “We are also in the midst of finalizing deals that will bring other exciting sporting events, popular touring shows, major concerts, and a variety of special events to the region,”saidWilliamWeidner, presi- dent and chief operating officer of Las Vegas Sands Corp. Venetian Macau will be one of the largest hotels in Asia and will be the city’s first true mega-resort. In addition to the arena, it will fea- ture 3,000 all-suite rooms, 1.2 million-square feet of meeting, conven- tion and exhibition space and a wide range of dining, shopping, and recreation options. Wynn seeks US$1.25 Billion Loan Wynn Resorts has hired three banks – Bank of America, Deutsche Bank and Societe Generale – to arrange US$1.25 billion of loans to double the size of its resort in Macau.In addition to funding the resort expansion, the loans would also be used to trim the company’s inter- est costs by replacing a US$764 million deal signed in 2005. “It’s vital that Wynn expand its properties in Macau so that it can also benefit from the growing mass-market sector,” said Credit Su- isse analyst Gabriel Chan. “Wynn has done pretty well in capturing the high rollers because Wynn Macau offers more luxurious, upscale amenities that cater to VIP customers.” The expansion,due to be completed in the third quarter of this year, will add 11,427 sq. m of casino space, along with a theatre and more retail and food outlets. Wynn Resorts also plans to build a new hotel, Wynn Diamond Suites, adjacent to the existing property in Macau. Macau Expansion Concerns Financial analysts are expressing increasing concerns about the ag- gressive expansion in Macau’s gaming sector. According to Credit Suisse’s Gabriel Chan, the share prices of company’s exposed to gaming in Macau “will be very volatile and bumpy this year,” as the supply of tables will increase by 40%, while revenues overall are ex- pected to grow just 16%. The average take per table peaked at US$10,000 per day in 2002 – the year the Macau government ended Stanley Ho’s 40-year ca- sino monopoly. Average revenue per table has been falling steadily since then. In 2006 the average take was just US$3,200/table/day given the rapid increase in the overall number of gaming tables, and the figure could reach as low as US$1,800 by 2010, according to Morgan Stanley gaming analyst Rob Hart. “We’ve been warning investors,” he said. Macau had 1,388 gaming tables at the end of 2005, but the num- ber almost doubled to 2,762 by the end of 2006. Analysts expect the number of tables to reach 10,000 by the end of 2010. Lax Aussie Casino Oversight Yet another Australian casino has been called to task for failing to check the credentials of a gambler who lost A$6 million (US$4.7 mil- lion) of the A$8 million he stole from his employer (A$1 = US$0.78). In details of the case made public by the Casino Control Author- ity, Sydney’s Star City had suspicions for more than a year about Erick Tjandra, a 31-year-old bank clerk, who was spending large amounts of money at the property. However, it was ultimately a call from a ca- shier to Austrac, which monitors laundered funds, which resulted in the discovery of his criminal activity. Tjandra pleaded guilty last October and was sentenced to four years in jail. But the District Judge Christopher Armitage took the ca- sino to task for failing to make inquiries earlier. He said the gambler was not Kerry Packer or an Asian prince despite being one of the big- gest players in the casino’s high-roller room. The clerk, who made A$35,000 a year, was the casino’s num- ber-one player in January 2006 and was betting at least A$20,000 a hand. Staff had made inquiries about Tjandra to the police, but they reported he was unknown to them and it was only after he was questioned about the source of his funds and claimed to have received an inheritance that Austrac was contacted by one of the casino’s cashiers. Star City claimed it has since put in procedures to increase the scrutiny of high-roller funding. But the case once again raises the spectre of serious political pressure to hold venues liable for theft un- dertaken to support a gambling habit. Plans for a Vietnam Gambling Hotspot Developers are planning to create a gambling hotspot along a re- mote stretch of beach in Vietnam. The project, dubbed Ho Tram, would be situated on the South China Sea, a two-hour drive east of Ho Chi Minh City. The partners behind the project are Toronto-based Asian Coast Development Ltd, US resort developer Fontainebleau Resorts, and Paul Steelman, a Las Vegas-based casino architect. Their US$4 billion project, to be located along a stretch of undeveloped beach and for- est in Xuyen Moc, Ba Ria Vung province, is still awaiting approval from the Vietnamese government. “We want to bring the best of America to Vietnam,” said Michael Aymong, chairman of Asian Coast. Plans for the project’s first phase feature 10 restaurants,a Greg Norman designed golf course,an 8-acre swimming pool, 1,200 hotel rooms and an 80,000 square foot Las Ve- gas-style table games casino.The resort’s theme would be a “lost city of Vietnam,”he said. During the Vietnam War, the area was mostly out of the fighting and served as a seaside recreation area for American and Australian troops.Later,the capital of the region,VungTau,was a launching place for the Vietnamese “boat people” who fled the communist regime in the 1970s and 1980s for places such as Hong Kong. The project has been in the works for three years. Developers say they have a 50-year lease from the government on the 3.5 km long beachfront site. The government will generate money through the land lease and from a cut of the gambling revenues. If approved,constructionwouldbeginwithin threeor fourmonths, and the development would open about two years after that. There are a handful of small casinos in northern Vietnam, but gambling is still relatively undeveloped in the country.Vietnam’s lack of a legalized and regulated gambling system has prevented major international casino operators from investing in the country.