Caixin Weekly | Thailand Plans to Legalize Gambling (AI Translation)

财新周刊｜泰国拟“开赌”

[para. 1] The picturesque Karon Beach in Phuket is set to witness the establishment of large-scale integrated resorts featuring gambling services, as Thailand's Cabinet has initially approved the draft "Entertainment Complex Bill" for parliamentary review. Expected to be legalized by mid-2025, this move will introduce Thailand as the eighth Southeast Asian country to legalize gambling, responding to the slow recovery of its tourism sector post-pandemic. In 2024, tourism revenue is projected at 1.8 trillion baht, about 60% of 2019's figures, spurring efforts to diversify attractions such as legal gambling. Traditionally, progress has been stalled by Buddhist traditions opposing gambling. However, spurred by potential economic gains, Thailand is advancing this venture.

[para. 2] Thai Prime Minister Phetongtan highlights the economic and social benefits of legalizing gambling, such as boosting national revenue and increasing foreign investment. The government hopes this initiative will increase foreign tourist numbers by 5% to 10% and create thousands of jobs. Development is a result of efforts beginning December 2021 when a special committee was formed to explore casino legalization. The legislation mandates casinos be part of integrated resorts with hotels, shopping centers, and more, with licenses offered to well-capitalized firms. Tax rates on gross gaming revenue are among the most competitive in Southeast Asia, second only to Cambodia.

[para. 3] The Thai legislative process requires the "Entertainment Complex Act" to be reviewed by both the House of Representatives and the Senate. Approval is anticipated by mid-2025, with the first entertainment complexes opening around 2029, potentially before Japan's first casino-inclusive resort. Several major international gambling groups are interested, with some already establishing a presence in Bangkok. Integrated resorts are designed to diversify tourism and provide economic benefits, prompting significant interest in Thailand's potential gambling market.

[para. 4] Thailand's tourism industry, a major GDP contributor, struggled post-Covid. The nation anticipates receiving 35 million foreign tourists in 2024. Activities like casinos in large entertainment centers are predicted to increase tourist spending significantly, potentially growing the economy by a substantial margin. A 2024 Citibank report suggests a mature gambling market in Thailand could make it a major player globally by 2025. The new legislation is expected to address illegal gambling and boost investments, with the Ministry of Finance projecting increased GDP and national revenue.

[para. 5] Attempts to legalize gambling date back to the 21st century but faced resistance due to cultural and social concerns. Current challenges include managing potential societal impacts such as addiction. Despite cultural reluctance, 59.6% of Thais over 15 engage in some form of gambling. Government restrictions in the draft bill address some concerns, and ongoing debates focus on how to regulate online gambling. Globally, the gambling industry is substantial, and gambling activities are embedded in Southeast Asian culture, contributing to several economies through tourism and taxes.

[para. 6] Successful models like Singapore highlight potential benefits for Thailand, especially by following robust regulations to boost its gaming industry. Proposals suggest Thailand’s gaming market could become Asia's second-largest, following Macau. Singapore’s effective regulation leads to significant revenue and job creation, and recent expansions promise further economic upturns. Its market faces challenges like customer verification failures but remains a strong leader in the region. Comparisons to Thailand illustrate the potential benefits of establishing a similar industry.

[para. 7] In other Southeast Asian countries, the Philippines might surpass Singapore as a significant gaming destination. The Philippines’ supportive stance towards industry deregulation contrasts with others, especially as it engages in offshore gambling ventures. Regulatory changes and economic impacts of the gaming industry are discussed, including its contribution to GDP.

[para. 8] Cambodia presents a growth model, with its integrated resorts yielding significant revenue. Improvements in infrastructure and regulation have significantly elevated Cambodia’s status as a gambling destination. Thailand's endeavors could challenge existing regional dynamics by drawing tourists and investments. While online gambling remains contentious, proposed developments could also spur discussions and legalization regionally, further integrating the economic landscapes. The competitive pressures arising from these legalizations might reshape the Southeast Asian gambling sector, aligning future growth with global trends.