Thailand is considering a bold new strategy to boost foreign arrivals and increase tourism spending: casinos. This approach has proven successful for Macao — now the world’s largest gambling hub — and Singapore, which has had thriving casinos for 14 years. If Thailand’s draft bill becomes law, the country could emerge as a significant competitor by the end of the decade, according to industry experts.
“They’ve seen the impact casinos had in Singapore and the financial power of gaming in Macau. If done correctly, Thailand could greatly enhance its appeal as a tourist destination,” said Ben Lee, managing partner of IGamiX Management and Consulting. While tourism is crucial to Thailand’s economy, growth remains slow, particularly since tourist arrivals haven’t fully rebounded from the Covid-19 pandemic. The full return of Chinese travelers, in particular, is anticipated to make a big difference.
Thailand, Southeast Asia’s second-largest economy, welcomed approximately 28 million foreign visitors in 2023, a sharp decline from nearly 40 million in 2019. “Thailand is a tourism powerhouse, feared by others in the region. Yet, it is still grappling with pandemic recovery,” said Lee.
In June, former Thai Prime Minister Srettha Thavisin initiated the drafting of a bill to legalize entertainment complexes, aiming to boost tourism spending, employment, and economic revival. Currently, Thailand only permits state lottery or licensed horse betting, making most forms of gambling illegal. Though Paetongtarn Shinawatra has since taken over as prime minister, the bill is likely to proceed.
“Despite political fluctuations, casino plans are likely to maintain momentum,” said Maybank Investment Bank analyst Yin Shao Yang. If passed, Thailand’s casinos could generate 187 billion Thai baht ($5.5 billion) in revenue, around 1% of the country’s GDP, per Maybank research. Thailand’s economy grew by 1.9% in 2023, with a projected growth of 2.7% this year, according to the finance ministry.
“If Thailand sets up casinos properly, it could potentially surpass all other Asian gaming markets, except Macao,” added Lee.
Gary Bowerman, director of travel and consumer intelligence firm Check-in Asia, noted, “Southeast Asia’s tourism is highly competitive. Countries are positioning tourism as a key economic pillar. Legalizing casinos would strengthen Thailand’s standing given its already substantial tourism economy.”
What to Expect
The key question for industry watchers is which Thai cities might host these casinos. Although no official announcements have been made, analysts speculate that casinos might not be in the heart of Bangkok. “Bangkok is already developed with little space for more. Lesser populated areas like Thailand’s Eastern Economic Corridor, including Rayong, Chonburi, and Chachoengsao, are more likely,” said Maybank’s Yin. Unlike Macao’s clustered casino model, Thailand may spread casinos across different regions, such as tourist spots like Phuket, Krabi, Chiang Mai, and Pattaya.
“The government aims to maximize investment in areas like Pattaya,” Yin said, predicting a $5 billion expenditure. The U-Tapao Rayong Pattaya International Airport’s second runway project underscores efforts to boost tourist capacity in Pattaya.
Thailand is expected to follow Singapore’s integrated resort model, offering activities for non-gamblers too. “Look at Marina Bay Sands: it has bars, an infinity pool, hotels, museums, and restaurants. It attracts young people who aren’t gambling but come for other experiences,” Bowerman added.
A draft of the Entertainment Complex Act shared by Bangkok Post in August stated that Thai citizens must pay 5,000 Thai Baht ($147) to enter casinos, similar to Singapore’s entrance fee for locals. Foreigners would reportedly enter for free. Casinos must obtain a valid license to operate for up to 30 years, with an initial registration fee of 5 billion baht and an annual payment of 1 billion baht.
Bowerman highlighted that the Thai government might require U.S. operators entering Thailand’s gambling sector to collaborate with Thai companies, ensuring local interests are vested.
Will Macao Remain No.1?
Experts agree that if Thailand establishes five to eight casinos nationwide, it could eventually surpass Singapore in popularity and revenue. However, Macao’s casinos are likely to remain the top contenders. In the first half of the year, Macao’s casinos generated 114 billion Macanese Pataca ($14.16 billion), while Singapore’s two casinos earned $2.53 billion.
Author: Mr. KC Cuijpers
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