Thailand's government has proposed a bill to legalise gambling in massive "entertainment complexes" featuring facilities like hotels, restaurants, convention centres, music venues, sports arenas and amusement parks.
Thailand's stunning beaches, delicious food, unique cultural heritage and red light districts are already big drawcards for tourists. Soon the country could add roulette, blackjack, poker and other forms of currently illegal gambling to its list of attractions.
According to a statement on Pheu Thai's webpage released on Saturday, legalising underground gambling activities and tax on the project itself could be worth more than 50% of GDP, which will help boost the economy and can be spent on education development and other projects.
Casino entertainment complexes will enable the country to tap into the so-called "fun" economy worth an estimated US$13.7 trillion, the ruling party said. The project is part of the Pheu Thai-led government's policy statement, which Prime Minister Paetongtarn Shinawatra outlined in parliament on Sept 12.
According to government sources, the Finance Ministry has finished drafting the Entertainment Complex Act and the bill will undergo a public hearing as required by Section 77 of the constitution.
After the hearing, the bill, along with public feedback, will be presented to the cabinet for consideration.
Under the bill's 65 sections, an entertainment complex must acquire a licence to operate, which would be valid for up to 30 years.
An operator must also pay 5 billion baht to register, plus an annual payment of 1 billion baht. Each complex will be assessed every five years. After 30 years, the licence can be renewed for another 10 years.
Individuals under the age of 20 are prohibited from entering such venues. The complexes are open to all foreigners, but Thai citizens must pay an entrance fee of 5,000 baht.
The Bangkok Post reported that licences were expected to be issued for five casinos with two in Bangkok, one each in Chiang Mai and Phuket and one in the Eastern Economic Corridor (Chachoengsao, Chonburi and Rayong provinces).
Thailand's early casinos
Casinos have a long history in Thailand. According to James A Warren's book Gambling, the State and Society in Thailand, legal gambling houses were a valuable source of revenue for the country's rulers as far back as the 17th century, mainly catering to the growing Chinese population.
When King Chulalongkom came to the throne in 1868, about 20 per cent of taxes came from gambling.
However, even then gambling was seen by many as a disease with the symptoms "poverty, debt slavery, and crime", and during the late 19th century King Chulalongkom began shutting down the proto-casinos with the last abolished in 1917.
Other forms of gambling were increasingly regulated and restricted until the current Gambling Act was adopted in 1936.
Warren noted that between 1939 and 1945, the government tried opening a series of state-owned casinos, but all were short lived.
Those casinos were in some ways similar to the ones the Thai government is now proposing, with locals charged much more for entry than foreigners.
"Despite the revenue it provided, the casino experiment had been a failure, primarily because the government was unable to attract the 'right' clientele — whether foreign tourists or wealthy Thais — or to exclude the majority of the population that could ill afford to gamble," Warren wrote.
These days, legal gambling in Thailand is restricted to licensed horse racing and the national lottery.
However, other kinds of illegal gambling — including underground casinos and unlicensed sports betting and lotteries — are commonplace.
Thais also often travel to gamble in casinos in Cambodia, Vietnam, Myanmar and Laos.
A survey by Thailand's Centre for Gambling Studies and Centre for Social and Business Development in 2019 found that 57 per cent of Thais had gambled in the previous year with government lotteries the most popular form of gambling, followed by underground lotteries, card games and football betting.
"We have to admit that there is illegal gambling in the country, we are trying to get rid of (it) but it cannot be wiped out, so we have to rethink and see that it is time for this," Deputy Finance Minister Julapun Amornvivat told reporters earlier this year.
Singapore to be the model
The government has said Thailand would emulate Singapore, which legalised casinos in 2005. A number of international casino operators have flagged interest in establishing operations in Thailand if the law is passed.
Robert Goldstein, the chief executive of casino and resort company Las Vegas Sands which operates casinos in Macau and the Marina Bay Sands in Singapore, earlier this year said the company "absolutely" had interest in Thailand.
"It's a very, very exciting market in a lot of levels," he said on an investor call.
"Just the sheer size of population, the accessibility and the willingness of people to travel to Thailand. It's obviously, I think, number one resort destination city in Asia.
"I think it's conceivable. It's early days, although we still have work to do with the numbers and understanding it."
Legislation still faces big hurdles
Adam Simpson, a senior lecturer in International Studies at the University of South Australia, said the law's passage still faced significant challenges, especially following the surprise removal of Srettha Thavisin as prime minister by the country's Constitutional Court.
Critics argue that legalising casinos would not eliminate illegal gambling, while also exacerbating problem gambling.
"At present the bill excludes Thais unless they pay around $200 to enter the casino, however once the casinos are established there will be constant pressure from the casinos and their political backers to make it easier for Thais to enter the casinos to expand the revenue base," said Dr Simpson.
Dr Simpson said the Bhumjaithai Party, which is the junior party in the governing coalition, opposed the legislation, arguing the benefits will not outweigh the negative impact.
"There has also been opposition from the Democrat Party," he said.
'Considerable risks'
Richard Horsey, a senior adviser to the Crisis Group thinktank, said the move to legalise casinos came with other "considerable risks" — including providing opportunities for criminal syndicates and irritating Beijing.
"Casinos are attractive to criminal syndicates not only as a lucrative revenue stream in their own right – for example by providing online gambling services to mainland Chinese punters, illegal in China – but also because they are an attractive means to launder profits from other criminal activities, from drug trafficking to scam centres," he said.
"Given that a large proportion of the revenues of Thai casinos are likely to come from visitors from mainland China, Thailand also faces the risk that Beijing may take a dim view of this development.
"China is concerned not only about the moral and social consequences of gambling, but also that junkets and other overseas gambling have been a key conduit for capital flight."
Mr Horsey said that even Singapore was struggling to deal with money laundering and other activities by transnational criminal organisations.
"Thailand will hope to emulate Singapore by putting in place a fairly credible and effective regulatory infrastructure for casinos," he said.
"But the risk is that it ends up being more like some other jurisdictions in the region that have struggled to control rampant criminality in the gaming sector."
He said that criminal syndicates generally gravitated to the least well-regulated jurisdictions.
"So the question is not only whether Thailand can emulate Singapore, but also whether it can do better than Cambodia, the Philippines, Laos and Myanmar," he said.
"It probably can, but one thing is clear from the recent history of transnational crime in the region, which is that these syndicates try to diversify as much as possible across multiple jurisdictions, so that they are more resilient to crackdowns.
"This means that Thailand will inevitably have to grapple with these difficult challenges."
(Sources: ABC News, World Casino Directory, Bangkok Post, The Nation)
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