Thailand is setting its sights on becoming a global gaming hub, with plans to build a casino industry that generates billions in revenue, draws some of the biggest names in the business and benefits a thriving tourism sector.
However, experts warn success would come only by playing its cards right on regulation, an area in which Southeast Asia’s second-largest economy has a patchy record, such as its botched efforts to legalize cannabis in 2022.
“They want a transparent process that will protect their investment with appropriate regulation,” Spectrum Gaming Group founder Fredric Gushin said, which helped Singapore build its casino industry into the world’s No. 3, after Macau and Las Vegas.
Illustration: Louise Ting
“This is a once-in-a-generation opportunity,” he said.
By some estimates, Thailand has the potential to eclipse Singapore’s glitzy casinos, in part by luring heavy hitters such as Las Vegas Sands Corp, MGM Resorts International and Galaxy Entertainment.
To draw the big names, Thai authorities would have to combat perceptions of favoring big domestic players, adopt an open and competitive development process, and strike a delicate balancing act with domestic punters, two consultants said.
Last month, the Thai Cabinet approved a draft law to legalize gambling in so-called entertainment complexes as a way of boosting the economy at a time when GDP is expected to expand less than 2.9 percent this year, lower than previous estimates.
Reuters has reviewed the latest draft of the legislation, not yet made public, which envisages a new commission to regulate gaming and coordinate with investors in setting up such complexes.
“We estimate Thailand’s gross gaming revenue could reach US$9.1 billion when fully ramped,” Citi said in a research report in November last year. “This will rank Thailand ahead of Singapore.”
Nestled in resorts offering a range of entertainment, Singapore’s casinos were part of the city-state’s fastest-growing tourist receipts category last year.
Thailand’s potential as a gaming destination, with casinos proposed in the capital Bangkok, on the holiday island of Phuket and three other sites, is underpinned by its role as a regional magnet for tourism.
Thailand saw 35.55 million foreign tourists arrive last year, up 26.27 percent year-on-year, nearing its pre-COVID-19 pandemic record of 39.9 million in 2019 that helped generate 1.91 trillion baht (US$56.73 billion) in revenue.
Experts also see the propensity of Thais to gamble as an attraction for casinos, but household debt levels that are among the highest in Asia demand robust government safeguards.
Thailand currently allows gambling in state-controlled horse racing, the lottery and betting on some sports, such as boxing.
The government, led by the populist Pheu Thai party, hopes its plan would attract at least 100 billion baht in new investment, for an annual boost to foreign arrivals by 5 percent to 10 percent, helping to generate revenue of more than 12 billion baht a year.
Thailand’s economy, dominated by home-grown billionaire families, has long had a reputation for crony capitalism with a track record of governments seen to back big businesses, a factor of potential concern for investors.
Gushin said he expected the government to emphasize “true competition” as it seeks requests for proposals in coming months. Some well-connected Thai enterprises are already angling for a piece of the action.
“We are interested and ready to put in a bid,” said retired Colonel Phantat Sangchot, secretary general of the Royal Turf Club of Thailand, which has close ties to the royalist military.
It plans to invest up to US$10 billion for resorts that include casinos and horse-racing venues across three cities, he added.
Pasu Liptapanlop, a director of Proud Group, which owns two InterContinental hotels in Thailand, said it was keen to partner with international gaming companies.
“As operators of hotels, we have been hearing this debate about the need to bring in higher value tourism over high volume,” he added. “This could be a step in that direction.”
However, public support for the plan is limited, with a poll last month showing nearly 60 percent of 1,310 respondents did not back it.
Against that backdrop, political opposition is also growing.
Palang Pracharat, the pro-military party that ruled Thailand before the 2023 election, said it opposed the initiative for fear it could fuel gambling problems and swell household debt.
“This problem will be harmful, like a nasty cancer that destroys our society,” party spokesman Piya Tavichai said this month.
Yet the size of Thailand’s population suggests domestic punters could prove a powerful attraction for investors, with Citi estimating that about half of those aged 20 and older could be casino players.
That would far outstrip the 99,000 Singapore citizens and permanent residents, or about 3 percent of the island nation’s adult population, who visited its casinos in 2023.
Adopting strong social safeguards would be a balancing act, as potential investors would watch regulations closely, gaming consultant Daniel Cheng said.
“If they become too onerous, then less people will participate and the underlying value of the 66 million local population starts to diminish very, very quickly,” he said.
Additional reporting and writing by Devjyot Ghoshal
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