Japan Poised to Bet on Gambling: The Ticker
For years now, Tokyo's powerful governor, Shintaro Ishihara, has been angling to allow casinos to operate in Japan. The idea is to boost tourism and tax revenues as the nation's workforce ages. Legislators long stymied such efforts, fearing gambling would fuel organized crime and provide little benefit to the broader population.
One reason those concerns ring a bit hollow is that gambling, in the form of pachinko, already constitutes one of Japan's biggest industries. The government pretends the wildly popular arcade game, in which players receive cash and prizes via middlemen, isn't wagering.
Economic realities since a record earthquake in March are driving an about-face among lawmakers. A group of 150 of them is introducing a bill that could allow resorts to install slot machines and gambling tables at hotels, shopping facilities and restaurants, Bloomberg News reported.
Japan isn't alone in its Macau-envy. The former Portuguese colony that returned to Chinese hands in 1999 is raking in the money. In 2010, gambling revenue there was four times that of the Las Vegas Strip and jumped 44 percent in the first 11 months of 2011. That's why Vegas magnates like Sheldon Adelson and Steve Wynn have been doubling down on Macau. It's the only place in the world's fastest growing major economy where casinos are legal. Talk about a steady customer base.
Cambodia, Malaysia, the Philippines, Singapore and South Korea have moved in recent years to get a piece of Asia's gambling action. From Thailand to Indonesia, lawmakers are mulling similar moves. Add Japan to the list.
Casinos could emerge as a 3.4 trillion yen ($44 billion) industry, according to a 2009 study by Ryosaku Sawa of Osaka University of Commerce. Facilitating its growth would seem to be a no-brainer for a government facing hundreds of billions of dollars of reconstruction costs from the March 11 earthquake, on top of the world's largest public debt.
Will Tokyo finally roll out the welcome mat for casinos? It's looking like a pretty good bet.
(William Pesek is a Bloomberg View columnist.)