$3 billion of foreign capital in casinos, GDP up by 0.58%, research
$3 billion of foreign capital in casinos, GDP up by 0.58%, research
If foreign investment in the casino business increases by about $3 billion compared to the current level, Vietnam’s GDP will rise by 0.58% in the first year, according to research conducted by the Institute for Regional Sustainable Development (IRSD).
The research indicates that the gambling industry and legal casinos can bring about significant benefits, such as an increase in budget revenue, creation of employment and improvement of income of local workers, attraction of investment and tourists, strengthening of trade and reduction of flow of foreign currency.
According to the research, if foreign investment in the casino industry increases by about $3 billion compared to the current level, Vietnam’s GDP will increase by around 0.58%.
The researchers also said that sociological findings indicate changes in people's perceptions about the gambling industry and casinos, with 71% of respondents saying that if casinos are open to Vietnamese people, they will attract many players; 64.7% say the gambling industry will help increase budget revenue; 47.4% have a positive view on the creation of employment by the casino industry; and 46.2% say they will have a positive influence on investment attraction.
Dr. Nguyen Dinh Chuc, IRSD Deputy Head, said the research also indicates the possible social impact of this industry such as reduction of labor productivity, increase of organized crime and family problems, indebtedness, and bankruptcy. However, the social impact is not always negative, and international experience has shown successful control measures.
In Vietnam, the gambling industry in general and casinos in particular are managed strictly. There are 64 lottery companies, eight casinos, two places for sports betting, and 43 centers of bonus electronic game in the country. Casinos and electronic gambling points are only open to foreigners.
As reported by the Ministry of Finance, last year the lottery business earned revenue of VND64 trillion, and paid taxes of approximately VND20 trillion. For casino business, revenue in 2014 reached VND1,379 billion and tax revenue was VND336 billion.
There are no official statistics for illegal gambling activities but according to reports from the Ministry of Public Security, 345 people were arrested last year for gambling, with the total money for gambling reaching more than VND10,000 billion.
IRSD’s survey in Tay Ninh province showed that on average about 200 Vietnamese people crossed the border to Cambodian casinos. The number increased to 700-800 people/day during the weekend.
Annual revenue of Cambodian casinos is estimated at around $250 million, and the majority of players are Vietnamese.
"Actually, gambling and casino management in the form of prohibition is becoming inefficient because it cannot help prevent illegal gambling activities and causes a budget deficit. Meanwhile, Vietnamese people are free to gamble in the casinos in Cambodia. It means that Vietnam still needs to manage all of the negative effects from operation of casinos but it does not earn any benefits," Chuc said.
Chuc said that, based on the findings, the researchers proposed that Vietnamese players would be allowed to participate in some types of gambling and bonus games in large-scale resorts in places located far away from densely populated urban areas.
