PM has new support
Is this the year gaming legislation will finally be approved in Japan?
The answer is a resounding “maybe.”
According to CalvinAyre.com, a bill to introduce integrated resorts with casinos “stands a chance” of being debated in parliament before the end of 2016.
“This time, it’s 100 percent happening,” former Japanese cabinet member Kotaro Tamura told CNBC—and Tamura’s optimism may be well founded. Not only does Japanese Prime Minister Shinzo Abe support the gaming proposal, he has been joined by three pro-casino officials who were promoted to high-level positions in August.
They are Secretary General Toshihiro Nikai; General Council Chairman Hiroyuki Hosoda; and policy head Toshimitsu Motegi. The influential Liberal Democratic Party members have reportedly agreed to push the bill during the current parliamentary session, which ends November 30.
The bill was first submitted to the Japanese parliament or Diet in 2013. It hit a speed bump in 2014 when an unrelated political scandal forced the House of Representatives to be dismantled. The gaming bill returned in 2015 but met with opposition from religious quarters and conservatives concerned about an increase in gambling addiction and other negative consequences.
A 2014 government survey indicated 5 percent of the adult population, or 5 million people, are compulsive gamblers, as compared to an average 1 percent figure in other advanced economies, CalvinAyre.com reported.
Nevertheless, Abe has called casinos “a key part of Japan’s economic growth strategy,” and with new support from fellow party officials and an LDP majority in both houses of parliament, he can “effectively guarantee the bill’s passage when it comes to a vote,” the website reported.
Steven Gallaway, managing partner at Global Market Advisors, said the bill could succeed this time as global gaming companies tout the benefits of entertainment destinations and also pledge to establish responsible gaming policies.
“If the public were to understand that there would only be a couple casinos and that they would be massive entertainment destinations that extend well beyond gambling, there would be a favorable opinion,” said Grant Govertsen of investment bank Union Gaming Asia Securities Ltd.
Analysts say IRs could pump $40 billion a year into the economy and help Japan reach its goal of attracting 20 million visitors a year by 2020.
“While I don’t ever see Japan becoming the next Macau or Las Vegas, it could likely become the next Singapore,” said Gallaway. “Both countries are politically and economically stable, have diverse levels of international tourism, and are geographically on opposite sides of Asia.”
Gallaway adds that Japanese IRs would attract more mass-market gamblers than the VIPs who patronize Singapore’s two gaming halls. But like Singapore, only two IRS are expected at first, most likely in Tokyo and Osaka. But that could be enough, said Govertsen.
“We believe that two IRs in Japan would quickly surpass the revenue story in Singapore, which in turn would make Japan the second largest gaming market in the world behind Macau,” he said.
