Tue, Feb 19, 2013 - Page 15 News List

Casino investors eyeing Hainan as next stop

Reuters, SANYA, China

The casino bar, with 50 gaming tables now, is currently open only to hotel guests, but when the resort is completed, local residents will be allowed in.

When players win, they receive “Mangrove” points that can be used to buy products available in the casino such as an iPad 3G or a Rimowa suitcase. Once luxury brands open outlets within the resort, customers will be able to spend their points in those stores. Art work from Zhang’s Beijing art gallery is also available for purchase.

Retail stores, including Prada and Louis Vuitton, will be part of a network of 20 luxury stores that will open at the resort next year, Zhang said.

Zhang, president of Beijing conglomerate Antaeus, has the financial backing of China Development Bank (國家開發銀行). The state lender invested 70 percent of the cost of the Mangrove Tree expansion.

“The local governments are very supportive,” said Zhang, who started off as a carpenter in his hometown of Zhenjiang in Jiangsu Province, and now is well known as an arts philanthropist and prominent film investor.

Married to Wang Qiuyang (王秋楊), a mountaineer whose father, Wang Chengbin (王成斌), was a former army commander, Zhang said any potential change to gambling restrictions would take time, adding that the government would need to decide whether to let other operators open similar casino bars.

“Gambling culturally is a very bad thing, but today there is a difference — gambling is a financial tool,” Zhang said.

“In Asia, even North Korea has two casinos. The richest country, Singapore, before you would never think society would accept it there. All over the world the attitude towards casinos is different from what it was traditionally,” he said.

China is positioning Hainan as an international tourist destination, approving the construction of 15 large resorts and 63 five-star hotels as part of the country’s five-year plan.

As Chinese spend their money in new casinos across Asia from the Philippines to Vietnam, pressure is growing on Beijing to keep more gamblers at home.

“To some extent, the approval of gaming on Chinese soil is inevitable,” said Gary Pinge, an analyst at Macquarie Group in Hong Kong.

“With regional markets already vying for a share of the Chinese gambling wallet, unless China brings gaming onto its own shores, it will not only lose tax revenues to other countries, but also the ‘multiplier effect’ from the consumption spend,” Pinge said.

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