Sun, Jul 15, 2012 - Page 8 News List

EDITORIAL: Casinos face a long road ahead

As global casino operators have built casino resorts in Macau and Singapore to help boost the cities’ tourism and gaming industries, Taiwan passed an amendment to the Offshore Islands Development Act (離島建設條例) in January 2009, which allowed the establishment of casinos on its outlying islands of Kinmen, Matsu and Penghu if more than 50 percent of voters in a local referendum agree.

In September of that year, Penghu held the nation’s first referendum on gambling, but its residents voted against building a casino resort. While the Penghu islands are short of money for improving infrastructure and often suffer from unstable supplies of water and electricity, about 56 percent of voters expressed concerns over the negative social effects of gambling.

Three years later, residents of Matsu showed a totally different attitude toward the casino resorts initiative. In a local referendum held on July 7, about 56 percent of voters voted in favor of a plan to build casinos there, versus 42 percent who opposed it.

The results of the Matsu referendum have raised questions in Taiwan and overseas about its possible social and economic implications. It also invites speculation over whether Penghu would hold a similar referendum again and whether other regions in Taiwan would follow suit.

Actually, Matsu lacks everything it needs to develop its tourism business: It does not have sufficient water and electricity supplies, its ports are small and it lacks a large airport to welcome guests. The referendum results suggest Matsu residents’ strong demand for infrastructure projects, which they otherwise cannot get from the central government. It also indicates residents’ hopes for jobs and wealth if casino resorts were to be developed there.

Whether or not Matsu becomes the “Mediterranean of Asia” as the casino developer, Weidner Resorts Taiwan, has vowed, neither the local nor the central government is yet ready for such a plan, which means the casino resorts will not be completed for at least several years.

This is for several reasons. First, no one can be sure when the government will pass gambling legislation and start issuing gambling licenses to potential operators; second, Weidner Resorts Taiwan will have to win the bid for the development project once the legislature gives its go-ahead, so its promises to local residents at this stage are simply castles in the air. Third, the Matsu casino plan has its eyes on Chinese gamblers in particular, but this strategy faces uncertainties under the current political situation across the Taiwan Strait and it depends on China further opening the door for its citizens to visit Taiwan’s outlying islands.

More importantly, legalizing gambling is still a controversial moral issue in Taiwan and the current focus in Matsu is mainly on casinos, rather than resorts, whereas the same issue in other Asian cities has clearly shifted from the moral debate to the objective cost-benefit analysis of how to develop more comprehensive leisure resorts and gaming industries there. As long as the Democratic Progressive Party maintains its anti-gambling stance and casino opponents’ worries about criminal activity and social order remain, legalized gambling in Taiwan will still have a long way to go for Matsu and other outlying islands.

Nevertheless, what Taiwan’s outlying islands need is a way to improve their overall tourism environments. Without attractions to attract tourists, these outlying islands will never become developed, even if they do have casinos. This also suggests that what Weidner Resorts Taiwan has promised to Matsu residents — a monthly subsidy of between NT$18,000 and NT$80,000 if the casino hits revenue targets — will end up bouncing just like a rubber check.

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