Hainan wants gambling legalized to lift economy


Zach Coleman


February 4, 2005


Amid the harshest crackdown on gambling of China's reform era, a group of legislators from the island province of Hainan are proposing a study on the legalization of gambling to revive the local economy.

The idea has attracted quick criticism in the country's media and stands little chance of realization in the short run, but just the appearance of public debate on the question while police are rounding up thousands of suspected gamblers and bookies shows how far China has come from Mao-era crusades to eradicate all gambling.

In making their proposal, the four members of Hainan's provincial delegation to the Chinese People's Political Consultative Conference pointed to the abundant revenue official lotteries now provide the country's welfare and sports departments. Hainan, they said, especially needs a boost because its industrial and agricultural sectors are stagnant and provincial revenue inadequate. Legalized gambling would fuel a boom in tourism, property and other areas.

James Tien, chairman of the Liberal Party, and other politicians across Asia have been dazzled by the explosive success achieved last year by Macau, whose coffers now overflow with gambling tax revenue. Singapore appears closest to taking a flier on casino gambling, having asked international casino operators to offer development ideas for gaming resorts in the Lion City by the end of the month.

Officials in Hainan have clamored for legalized gambling for almost two decades. Their confidence that they could get Beijing's permission to open a casino at least for foreign tourists led companies such as MGM Grand, MGM Mirage's corporate predecessor, and Club Med to announce plans to build casino resorts on the island in the mid-1990s.

At least one Canadian public company actually claimed to be operating gaming halls on the island, which has long been a center for underground gambling. Talk of such projects died down several years ago, but Western resort operators have set up shop on the island in recent times. Hainan tourism has gained a lift from becoming the home of the Miss World Pageant and the international Boao Forum leadership summits.

But MGM is now focused on Macau and Singapore, and Asian scholars say casinos in Hainan are a very long shot. ``At least for five years to come, I think there's no chance,'' said Zeng Zhonglu, head of the research division of Macau Polytechnic Institute.

``The social values of the people won't accept casinos,'' Zeng said. ``There's a big political risk,'' particularly if crime and other social problems follow in the wake of wagering.

A commentary published in China Youth Daily blasted the Hainan proposal, saying that the province's economy is in no worse shape than many other provinces so the island merits no special favors. The author cast doubt on how well gambling could be controlled on the island, noting the ready passage gamblers found across the forbidding North Korean frontier to Hong Kong entertainment tycoon Albert Yeung's Emperor Casino.

Hainan has occasionally been chosen as a testing ground for new policies so the gambling proposal may not be totally off the wall. Most notably, the island was designated as a special economic zone by Deng Xiaoping with various trade and regulatory privileges to attract foreign investment in the early 1980s. zach.coleman@globalchina.com

 


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