Push for Casino Gambling Faces a Key Test in Japan

  • TOKYO--The hard fought bid to legalize casino gaming in Japan--a possible $40 billion business--faces a critical evaluation in the coming weeks. Casino executives and Japanese politicians are stressed it's going to fail.

    Confidence had bubbled over in recent months that Japan could legalize casinos, placing the state to become the world's second-largest gaming market after Macau. Casino- resorts are being sold as a means to light a fire under the poor tourism sector in Japan as they have in Singapore, where some 60% have increased since its two resorts.

    Some analysts are pegging Japan's possibility at more than six times the Las Vegas Strip's $6.5 billion gaming-sales draw last year.

    "I 'm conscious Singapore and Macau have been successful in bringing in lots of folks from all around the globe in addition to many international assemblies," Prime Minister Shinzo Abe said in March. "Despite many challenges that we've got to discuss the best way to beat, I believe [casinos] have lots of values."

    But anxieties are once again growing among casino proponents that momentum is being lost by the strategy.

    Walking around to a giant calendar hung on the wall, Prime used a pencil to circle the remaining chances to discuss the bill during the present parliament session. With the casino bill merely one of 17 on the program, Friday, May 30, might be the only realistic date, Prime said. In order for casinos to become authorized in Japan, two bills should be passed-- another bill, and the present bill, which asks the government to create a legal framework for casinos within one year.

    At a party in Tokyo of the world's biggest casino companies, executives said they were concerned about the consequence.

    "As an ex-Wall Street man, it is about price impetus," said MGM Resorts International chief executive Jim Murren on Thursday. "When executives lose the price impetus, occasionally you lose the deal," said the Vegas-based executive.

    If the bill should happen to attend a vote, it's likely due to support from the ruling Liberal Democratic Party and several others, say proponents to pass readily. But even though adversaries are in the minority, some have outsize influence that could endanger the strategy, the proponents said.

    "This is a consensus society," said Toru Mihara, an advisor to the 200-member bipartisan group driving the bill, on Thursday.

    Whether the present casino bill will be debated on May 30 will probably be determined by the end of next week, placing increasing urgency on both sides. But the complexities of Japanese politics seemed to be the determining factor.

    The occasion was packaged with a who is who of the casino business, along with executives from leading Japanese firms that could reap the benefits of the law's passage.

    Earlier in the day more than 60 individuals, including five opposition lawmakers from the Japan Communist Party and the Social Democratic Party attended a meeting featuring addresses by betting attorneys and a gambling addict.

    These opposition parties said their strategy would be to kill the bill by obstructing it from being discussed, since they have restricted seats in parliament.

    "It's critical that the opposition will not let the discussion start," lawmaker Mikishi Daimon, a member of the Communist Party, told attendees of the gaming rally.


    "It is not only a brand new plant, not only a brand new building, not a 14-day Olympics," he told attendees at the casino convention.

    Based on 2012 data, Japan ranked 33rd internationally as a tourism destination with 8.4 million visitors, trailing way behind even considerably smaller Asian competitors like Hong Kong, Singapore and Macau, said CLSA. Almost 10 times more individuals visited top-rated France than Japan, the brokerage noted.

    "If we turn them down this time, the brokerage do not understand what they will believe," said Yoshiko Mimi Koga, referring to the large international casino companies who are keen to bid for licenses in Japan. "This is how we have been since the Second World War," said the casino advisor, whose business card is decorated with a Japanese comic strip design caricature of Koga.


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