The Japan casino bill currently being drafted by the country’s National Diet might be losing support, as Japanese Prime Minister Shinzo Abe’s ongoing scandals continue to plummet his approval rating.
Gambling expansion already spawns mixed feelings among the general public, but lawmakers in Abe’s ruling Liberal Democratic Party (LDP) have largely been committed to his efforts to increase tourism. Now engulfed in scandal, and with his approval rating at an all-time low, reports suggest some politicians might abandon the casino bill.
Abe’s LDP lost some power during Tokyo’s Metropolitan Assembly elections earlier this month, and this week an LDP-opposition candidate won the Sendai mayoral race. Both are major defeats for the Liberal Democratic Party.
“Continued negative coverage of the Abe administration, coupled with political losses for the LDP may reduce support for the gaming agenda, which already has only limited public support,” Hong Kong-based gaming analyst Vitaly Umansky told GGRAsia.
Abe is the first prime minister to serve non-consecutive terms since the end of the US post-War occupation in 1952. He was so popular that in March the LDP changed its rules to allow him to seek a third consecutive term at the helm of the party in 2018.
In hindsight, that decision might not have been in the party’s best interest.
Abe now finds himself at the center of a corruption scandal, albeit one that would barely make the news by US standards. He’s accused of awarding a government permit for a private veterinary school, and the sale of public land at a deep discount, to two friends, in exchange for relatively minor campaign donations.
The prime minister has denied any wrongdoing, but the public apparently isn’t buying it. His latest approval rating shows support is at less than 30 percent.
Las Vegas Sands, MGM, Wynn, Caesars, Hard Rock, Melco, and Galaxy Entertainment are just a few of the companies awaiting details of the Japan casino bill. Expected to be revealed this fall, several of the gambling operators have said they’re willing to spend $10 billion on a casino resort should they like what they see in the legislation.
They might not.
With public support mixed at best on fears that casino expansion could do harm to residents prone to gambling problems, the Diet is rumored to be considering strict regulations. From enforcing a costly entrance fee on citizens (as much as $100 per visit), to prohibiting casinos from extending credit to domestic players and banning cash slot machines, the potential restrictions might make for an unfavorable business climate.
A more liberalized market is thought to be capable of generating $25 billion a year in revenue. Along with the number of casinos, two being the most likely total, companies are also awaiting tax rates, upfront licensing costs, and which games will be permitted.
With few details set in stone, and now Abe’s corruption scandal losing him friends in the public and in the Diet, US gaming interests are expanding their focus towards other untapped potential markets. MGM, Caesars, and Las Vegas Sands all recently confirmed they’re eyeing Brazil.