Early indications are that Taiwan will adopt the sort of ‘Gaming Lite’ multi-purpose resort model adopted by Singapore and Vietnam—as and when Taiwan starts to build casinos following Monday’s ‘yes’ vote in the legislative assembly.
While the notion of casinos in Taiwan naturally grabs all the headlines, the background information on the most detailed plan to be announced so far sounds more like Singapore and Vietnam’s schemes for holiday resorts with a bit of gaming, rather than aircraft hangar-sized halls full of slot machines and baccarat tables found in gambling-focused Macau’s ‘integrated’ resorts.
On the Penghu Islands, an offshore archipelago long tipped as the first site on Taiwanese territory to host a casino or two, the talk is of an ‘international vacation village’. This would be a 120-hectare zone, featuring a tourist hotel of more than 2,000 rooms, a duty-free shopping mall, an international convention centre, golf courses and casinos.
Penghu county magistrate Peter Lin said in remarks quoted in the regional media that the gaming industry would be small and heavily regulated, with resort development trending toward hosting families.
Whether this is an example of the routine noises made by pro development lobbyists to head off criticism from environmentalists and other interested parties, time will tell.
Another point worth noting is that the political campaign for casinos in Taiwan may not be over quite yet. The governing Kuomintang (KMT) used its large majority to push through the necessary preparatory law in the legislative Yuan on Monday by an impressive 71 votes to 26. It would in theory allow casinos in three groups of offshore islands: Penghu; Kinmen and Matsu.
Opposition Democratic Progressive Party legislators voted against the bill, citing concerns about debt, crime and environmental degradation.
Taiwan’s President Ma Ying-jeou still needs to sign the bill before it comes into effect and some political horse-trading with opponents may take place before that happens. The locals in proposed casino zones will also need to be consulted in individual referenda. In two previous plebiscites, Penghu’s 90,000 job-hungry inhabitants gave casinos an emphatic thumbs up. But diehard opponents on Taiwan’s mainland are likely to try and rally any antis in what could be an emotional new referendum campaign.
Taiwan’s legislature will also need to amend another law called the Statute of Offshore Island Development, according to officials of the Public Construction Commission quoted in the local media. That could take time, and as the saying goes, a week is a long time in politics.
And from an investor’s viewpoint the number of casino licences issued and the gambling tax rate will be important considerations in deciding the attractiveness of the Taiwan market.
Taiwan’s cabinet is reportedly setting up a committee to work out detailed measures stipulating the regulation of gambling, such as the number and size of casinos to be licensed and the minimum capital required for operators.
The government of Penghu county is reportedly looking to raise NTD30 billion (USD909 million) from private investors for a scheme there.
Two locations—the Houliao Bay area and the Huhsi Port area—are candidate sites. The local authority hopes to have finalised the list of private investors by early 2010, with building work starting in 2011.
London-listed AMZ Holdings is a leading contender as either the developer of a project on Penghu or as a key partner in a consortium for a scheme. It has access to an 11-hectare waterside site acquired in 2007 on a speculative basis at a cost of USD10 million.
Other contenders interested in developing gaming resorts are a local firm called Great Penghu which has reportedly purchased a nearly five-hectare site for gaming, and the Penghu county government which plans to develop a 40-hectare site.
“We’ve wanted to stimulate development of the offshore islands, particularly tourism,” said Chang Sho-wen, the secretary general of the governing KMT’s caucus, in comments reported in the regional media.
Casinos could attract half a million tourist visits to the Penghu Islands each year, generating NTD100 billion (USD3 billion) worth of revenues in gambling and tourism, according to an evaluation study prepared by Taiwan’s Council for Economic Planning and Development.
