The global casino industry has its eyes firmly focused on the Japanese parliament this week, eager to know whether the Asian country is ready to open up one of the biggest potential casino markets in the world.
Signs are looking good: Japan’s ruling Liberal Democrat Party submitted a bill to parliament in early December which has garnered support from a group of 200 lawmakers, including the prime minister, Shinzo Abe. However, in order for the bill to be passed this year, a debate would have to be held this week, before the current parliament session ends on June 22nd.
Japan is potentially the sleeping giant of casino gaming, with experts saying that it could be the second-largest gaming market after Macau. Brokerage CLSA believes that a Japanese market could generate as much as $40 billion per year in revenue: over six times that of the Las Vegas Strip. Unsurprisingly, the major casino resort companies are clambering over one another to gain a foothold in the country, with Las Vegas Sands (LVS), Genting, MGM and Melco Crown all pledging to invest in a post-regulation Japan.
LVS Chairman Sheldon Adelson recently claimed that his company would spend “whatever it takes” to enter the Japanese market, and threw out a figure of $10 billion, which, he said, he would be prepared to pay in cash, if necessary.
The government is looking for new strategies to stimulate growth in the economy with their “Japan is Back!” campaign, and wants to attract 20 million overseas visitors per year by the time of the 2020 Tokyo Summer Olympics, double the current figures. Prime Minister Abe has been a vocal advocate of casino gaming in this regard, and visited several casino resorts during an official trip to Singapore last month.
While proponents of the bill had hoped that it would be debated several months ago, the delay may now be tactical prevarication, with supporters seeking to postpone a vote until autumn, a strategy designed to prevent its opponents from killing it off.
Takeshi Iwaya, one of the leading proponents of the bill, recently said that it made sense to keep the debate in the lower house where backing is strong. Should it progress to the upper house committee, which is chaired by an opponent of legalization, it might be quashed. Iwaya said that this would be a way of “keeping a grip” on the bill until it could be passed during an extraordinary parliamentary session later in the year.
However, this would mean that the bill would not be passed until 2015, which would make it difficult for casino developments to be ready in time for the Tokyo 2020 Games. Experts are expecting a hugely competitive bidding process once the bill passes, and it could be five years at the very least before the first casinos are up and running.