Inside Asian Gaming

INSIDE ASIAN GAMING | January 2014 14 COVER STORY It looks promising that the Tourist Gambling Site Management Act will pass soon in 2014 because the administration of President and Kuomintang Chairman Ma Ying Jeou has included the act with the bills it considers priorities, meaning it is slated for legislative review in the current session. On the all-important question of junkets, policy is still being formulated, Mr Liu says, although it appears that it will come down somewhere between Macau’s permissiveness and Singapore’s hostility, with limited licenses, at least in the beginning, and a statutory cap on commission rates. “The Singapore model will be followed more closely than Macau’s,” says Mr Liu. “They’re very wary of bad guys and very concerned about money laundering and other crimes. I believe it will start restricted, but if it goes well it could be expanded.” Rough Seas It’s reported that pro-casino forces are marshaling their resources for another crack at Penghu, where an Isle of Man-based company called Claremont Partners owns 10 hectares on which it wants to develop a gaming resort. Their spokesman has said,“We continue to conclude that Penghu very much remains a viable location.” Caesars Entertainment is reported to have sent an executive to have a look at the Kinmen island group a little farther down the China coast, where half a century ago the Nationalists were trading artillery fire withMao’s forces just across the water in Xiamen. Kinmen also has hosted Liu Yung Hsiang, president of Taiwan construction giant Howarm. He visited a year or so ago in the company of Macau junketeer and casino operator Jack Lam, whose Jimei Group does business all over East and Southeast Asia. As for Matsu, while a number of global names have expressed interest, only Weidner has advanced an actual biddable plan—a fact that has not been lost on Mr Yeh alone. Ms Chen has said that “Other senior cabinet officials have doubts whether a Matsu casino can be successful because of the challenges in transportation and infrastructure that Matsu must overcome.” The locals say they’re not concerned. “Weidner has the will, but there are other companies that are waiting for the act to go through parliament,” says Matsu’s tourism head Liu Te Chuan. “We don’t know how many will come forward.” The key to all this is, of course, mainland China. No resort-scale gaming model can work in the Strait without its numbers and its passion for gambling—“which could all but eliminate any significant interest on the part of prospective integrated resort developers given that mainland Chinese citizens would be the primary target customer for any casino built on the outlying islands,” writes Grant Govertsen, a principal of Las Vegas-based investment brokers Union Gaming Group and the firm’s Asia analyst. In the tradition of relations between the two Chinas the issues are at once simple and complex. The simple part is that gambling is illegal in the PRC. In Macau it was grandfathered in based on a unique system of political autonomy that was established on its repatriation from Portugal.