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Singapore Has Chance at Gambling Pie

31 May 2004

SINGAPORE – As reported by the Singapore Business Times: "With competition in Asia's US$13 billion casino gaming industry starting to hot up, what are Singapore's chances of capturing a decent slice of the pie - assuming it wanted to?

"Pretty good, if the views of the world's gaming giants like MGM-Mirage, Caesars Entertainment and Venetian Sands are any indication. Moreover, if the Singapore authorities - and the major industry players - play their cards right, the gaming and related industries can transform Singapore's tourism, hospitality, arts and entertainment scene, leading to job creation and tax revenue on a significant scale - far more than many other industries (like biotechnology) on which Singapore has bet big.

"…To the giants of the gaming industry, risk aversion means, first and foremost, investing only in locations where they can be confident of the gaming regulatory systems, including enforcement, as well as legal systems (for purposes of debt collection, including cross-border debt). The quality of infrastructure, airline connectivity and availability of support industries also matter.

"Singapore has advantages over other Asian locations (including Macau) in all these areas, but its biggest advantage lies in the perceived integrity of its regulatory systems. This is a matter of confidence and trust, built up over time, and is not something other locations can easily replicate.

"…Singapore has an additional advantage over most other locations in Asia that are vying for the gaming business: it needs the tax revenues less. This means it can afford to peg gaming tax rates at relatively low levels (like under 10 per cent).

"…However, there are two key issues that Singapore must face squarely if it wants to get the full benefits that the gaming industry can offer. One is that it must be prepared to allow local residents to patronise resorts, rather than confining them to foreigners or high rollers…"

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