Reuters, 26 Jun 04
Will Singapore bet on a casino? Stakes are high
SINGAPORE: State-run lotteries, casino cruise ships, illegal bookmakers, horse racing and illicit poker dens... Singapore is no stranger to gambling.
But a proposal to build the first fully fledged casino in Southeast Asia’s wealthiest state is dividing public opinion and provoking a groundswell of polite criticism in a nation where decisions are usually sewn up quietly behind closed doors.
Casinos would accelerate efforts to remould Singapore’s $93 billion economy into a services hub as China’s rapid economic growth erodes the city’s traditional manufacturing base and fast-growing cities such as Bangkok vie for tourist dollars.
They would open up a new avenue for tapping the growing affluence of Asian travellers, while plugging revenues lost to illegal gambling dens and countries where casinos are legal such as Cambodia, the Philippines and potentially Thailand.
But critics say Singapore is flirting with a social disaster. Evidence of the sensitivity of the subject: homegrown moviemaker Jack Neo’s latest work “The Best Bet”, which tells the story of three Singaporeans obsessed with the national lottery.
“What I want people to think about is, if you get into big trouble, if you gamble so much, it affects your family, it affects your life entirely,” Neo told Reuters.
Thailand, like Singapore, is also considering legalising casinos, while the Philippines announced this week it was accelerating a $15 billion casino and entertainment project.
Neo, a former gambling addict who wrote and directed the film, once spent S$1,200 ($700) a month for several years on the lottery. Critical but resigned, he reckons a casino is natural for a developed nation already betting heavily in lotteries, on cruise ships and via illegal bookmakers. He expects it will go ahead.
Government delegations have flown to Las Vegas and the Chinese gambling enclave of Macau to study casino models, and a decision is expected around the end of the year.
Financially compelling: The financial case is compelling, analysts say. GK Goh Research estimates betting revenue accounted for nearly 10 percent of Singapore’s overall government taxation in 2003, a figure that would swell if a casino opened. Singaporeans already spend about $180 million a year in neighbouring Malaysia’s casinos, which bar Muslims. About $140 million of Singaporean money is spent in Indonesia’s Batam island casinos and about $400 million is spent on casino cruises.
The Innovation Group, a U.S. consultancy that compiled the data, said “floating casinos” and illegal gambling in Asia were worth about $4.2 billion alone. Some estimates put the value of Asia’s legal gambling industry at about $14 billion.
“From my perspective I don’t see any reason why the government would not want to take that step to open and allow a casino,” said Steven Lim, the executive director of RGB, a Malaysia-based gaming supplier.
The Business Times estimates a casino in Singapore could earn $235-$335 million a year for the operators and create up to 1,000 jobs. Las Vegas Sands Inc, which opened a lavish Vegas-style new casino in Macau in May, has said it is ready to pump in as much as US$2 billion to operate a Singapore casino.
Hong Kong billionaire Stanley Ho’s gambling empire showed interest this week, along with Harrah’s Entertainment Inc, the number two U.S. casino company, and Vienna-based Casinos Austria International Ltd.
The draw is simple: Singapore boasts Southeast Asia’s highest per-capita income, Asia’s sixth-busiest air hub, the world’s third-largest number of city business conventions in 2004 and increasing numbers of affluent Chinese tourists.
Social ills: But public debate simmers over the social consequences and a proposal to restrict local access in the hope of heading off widespread gambling addiction.
Trade Minister George Yeo triggered an angry public response in March when he said: “If you are not of a certain economic class, you should not even think of going there.”
Islamic scholars have condemned the idea, and the Straits Times newspaper has bristled with public criticism. “There are certain businesses we should never get involved in and gambling is definitely one of them,” one resident, Ling Wai Ping said.
Even a senior official at Sociedade de Jogos de Macau (SJM), which enjoyed a 40-year monopoly on casinos in Macau until this year, speaks of the dangers. “In my view, if a place that is already a financial centre, (where) you have sophisticated trading, it’s not advisable to have a casino there,” SJM director Ambrose So said this week. “The casino operation will have a cannibalising effect on other industries if the locals are addicted to gambling.”
Prime Minister Goh Chok Tong said in 1991 that a casino would never exist in Singapore so long as he was leader. He is due to be replaced this year by Lee Hsien Loong, son of Singapore’s founding prime minister Lee Kuan Yew.
“The upside of this is there is money being collected and being given to education, sports and culture,” said member of parliament Chandra Mohan. “If it’s for a good cause, the government can justify it morally and ethically, to an extent.”
Besides, industry executives say, Singaporeans will gamble whether a casino goes ahead or not. “If gambling is not legalised, it merely goes underground and it continues to exist. It’s part of Chinese culture to gamble even at weddings and funerals,” said Theodore Loh, managing director of orientgaming, which runs online gaming.