Inside Asian Gaming

INSIDE ASIAN GAMING | 12 COVER STORY Given Japan’s sizable urban population and high propensity to gamble, the viability of casinos in the world’s third-largest economy has never been in doubt. Pachiko parlor in Tokyo’s Akihabara district country’s chronic economic malaise. If there is anything to the wisdom of stock markets, maybe this really is the time. Pachinko manufacturing giant Sega Sammy Holdings has seen its share price rise more than 50% this year despite a big drop in profit for the 12 months ended 31st March and a subsequent lowering of its earnings forecast. Mizuho Securities, for one, told Reuters it likes Sega Sammy’s prospects along with those of Fuji Media Holdings, a broadcaster located in a section of Tokyo considered prime territory for casino development. Sega Sammy, which is developing a casino in South Korea in partnership with that country’s Paradise Group, stated a desire as far back as 2007 to invest in casinos in Japan should the opportunity arise and last February purchased a resort in Miyazaki Prefecture. Two months after that acquisition was announced, company President Hajime Satomi reasserted the company’s intentions, saying, “Of course, [a casino] is what we have in mind.” T ourism is Laos’ fastest-growing industry, and its importance prompted the government to authorize casino gaming as part of a massive special economic zone that was leased to Chinese developers in the province of Bokeo in the “Golden Triangle” frontier area bordered by Laos, Myanmar and Thailand. The development company Dokngiewkham quickly opened a casino, the Kings Roman, and unveiled plans for the 10,000-square-hectare zone that include an airport, luxury hotels, an industrial complex, a bridge across the Mekong River and housing for 200,000 workers and their families, mostly Chinese. In the process Laos found that it had largely relinquished sovereignty over the area, which evolved into a self-governing Chinese colony for all intents and purposes, a situation the authorities were apparently prepared to accept for the sake of the investment the small, landlocked nation of 6.5 million sorely needs. It was also a decision they came to regret when a second casino sprung up in Boten to the northwest across from China’s Yunnan province. The Royal Jinlun, as it was called, grew into a serious operation with 150 tables and 300 machine games and a clutch of supporting hotels where only Chinese was spoken, only yuan was accepted as payment and where even the prostitutes advertised on business cards printed in Mandarin. Crime became a serious issue, getting so bad that border security became an issue. When word got out that the owner was looking to sell to another Chinese investor, the government was compelled to act. The casino was shut down last year and a report in the English- language daily Vientiane Times said the SEZs would no longer be permitted gambling facilities “after finding such operations created serious problems for Laos.” The rulingdidnot affect the Kings Roman complex, which was adding buildings at that point, but it does speak to the risks Laos still poses for foreign capital more than 30 years after Pathet Lao guerrillas deposed the king and established socialist rule. A Macau-based real estate consortium known as Sanum Investment Limited has learned this to its dismay after a court in Vientiane at the end of last year ordered the seizure of itsThanaleng Slot Club inVientiane over a tax dispute. The venue is located on the main bridge from Thailand and books a hefty US$3 million in profits a month, and Kings Roman Casino Rewards and Their Risks LAOS