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Public and private sector supporters and opponents of Thailand’s integrated resorts (IRs) initiative are ramping up lobbying and expanding media coverage, but a lack of negotiation and compromise points to a volatile outcome.
Recent days have seen vanguard elements of pro-IR forces attempt to seize the initiative in the legislature, in company boardrooms and in the mass media, but community and politician scepticism is intensifying in tandem.
Apparently energised by meetings in Bangkok with Wynn Resorts, MGM Resorts International and possibly other companies, deputy finance minister Julapun Amornvivat said on Friday (May 23) that the government has placed enabling legislation for IRs at the top of the parliamentary agenda in early July.
Julapun also cited aggressive new investment parameters for IR projects that double or triple initial projections of 100bn baht ($3bn), likely culling the field of bidders to seven operators at most.
Julapun’s enthusiasm for IR policy broadly represents the commitment of Prime Minister Paetongtarn Shinawatra’s government to casting off the taboo of casino gambling and injecting the Thai economy with new blood from gambling tourism.
The problem Thailand faces is that significant voices and groups oppose either the very idea of land-based casinos or the speed with which the current government is introducing legislation.
That opposition manifested itself in February within the executive’s law drafting and scrutinising body, which added a clause to the draft law that prevents all but the wealthiest Thais from entering casinos.
The amendment, which requires locals to maintain 50m baht ($1.5m) in bank accounts for at least six months before casino entry, remains in the draft despite suggestions from within the government that it would be disposed of.
Retention of this amendment alone would be a dealbreaker for global gambling companies coveting the Thai market, particularly now that the government appears set to blow out investment requirements to as much as $9bn per property.
Ed Bowers, president of global development for MGM and a key player in MGM’s successful casino licence bid in Osaka, warned observers in Macau earlier this month and again in Bangkok last week that attractive tax rates, casino access for ordinary Thais and wider industry literacy in government are crucial at this stage of Thailand’s casino-resort experiment.
This does not even cover the dilemma of Thailand possibly deploying casino-resorts into regions that have radically different return-on-investment prospects if legislation does not recognise that Bangkok and Pattaya, for example, are very different creatures.
Bowers was more diplomatic than to suggest Thailand may go the way of Japan and South Korea in largely sabotaging their own casino tenders through inflexibility and a failure to understand and narrow the gap between government and industry needs and expectations, let alone those of urban and regional Thais.
Instead, he fought the good fight in a jurisdiction traditionally hostile to gambling, talking up economic growth and reduction in gambling harms in a regulated environment.
But the government has yet to publicly demonstrate that it understands the meat of Bowers’ position. That demonstration, if any, will now have to wait for the conclusion of a Senate committee examination of the bill.
Even before completing its review, the committee has suggested a referendum be held on legalising IRs, a likely disastrous outcome for IR supporters given the fractious debate surrounding the bill and the notoriously brittle state of Thai politics generally.
Ahead of the Prime Minister’s meeting with the committee in early June, the government must also dampen hostility toward the bill in the conservative Bhumjaithai Party and mitigate wider disagreements with its essential coalition partner.
For the moment, then, Thailand’s push for an IR industry is witnessing two groups, for and against progressive thinking on gambling, that are at cross purposes and railing one another with megaphones. It is not a prescription for a stable, prosperous outcome.
