There are few things we in Australia, and especially Sydney, don’t know about Singapore’s two new casinos and their schmick high-roller rooms and luxury resort-style hotels.
The Resorts World Sentosa and Marina Bay Sands have featured extensively in the James Packer campaign as raising the bar in the “clipping” of Chinese and other gamblers from Asia gambling and online casinos in Canada.
World Sentosa’s owners, Malaysian group Genting Singapore, is dabbling in shares of Echo, owners of the Star Casino in Sydney. The other owner, Las Vegas Sands Corp, owns the Macau Sands and Las Vegas Sands. It’s controlled by Sheldon Adelson, the elderly chap who, with his wife, spent tens of millions of dollars trying to finance Mitt Romney into the White House with some outrageous attacks on Barack Obama in the recent US elections.
In late October, Packer said Australia just wasn’t doing enough to meet the competition from Singapore:
“Unless we appreciate what the rising Asian middle class want and unless we cater for their desires, we have little hope of taking advantage of the opportunity [of booming Chinese tourist numbers].”
And Australia had to streamline its visa process for Chinese tourists:
“Let me give you one guess who has the world’s best practice in visa processing. Yes, it is Singapore. Currently the average processing time for a visa to Australia is two to five days, compared with a one to two-day turnaround via an online application to Singapore.”
Sounds like nirvana, doesn’t it? But what the Packer camp (aided and abetted by some sections of the inbound tourist industry, the media, as well as a former Qantas CEO or two) haven’t told you is how the bloom has gone off Singapore, as Bloomberg reported this week:
“Genting Singapore PLC and Las Vegas Sands Corp. reported the lowest gaming revenue in at least 18 months at their Singapore casinos, signaling slower economic growth and tighter rules are restricting spending by gamblers.”
“We have been waiting for the novelty factor of Singapore’s casinos to finally wear off, and that time may have finally come,” said Jonathan Galaviz, managing director of Galaviz & Co., a Las Vegas-based tourism industry analyst.
“Gaming revenues are sometimes a leading indicator of overall macroeconomic activity in a region. This may be a sign of things to come economically for Southeast Asia.”
More from the report:
“The decline in revenue from gaming coincides with a slowdown in the island-state’s economy, which the government forecasts will expand as little as 1.5 percent this year, from 4.9 percent last year. Efforts to lure gamblers with discounts and giveaways including free concert tickets have been stifled by the industry’s regulator, which charges local residents S$100 ($82) each time they enter one of the casinos.
“Genting Singapore’s gaming revenue dropped 20 percent to S$528.4 million in the third quarter and profit slid 47 percent, the company said.
“Las Vegas Sands said on Nov. 1 that gaming revenue in Singapore slumped 28 percent to $470.8 million. Its Marina Bay Sands resort was the only one of its seven locations to post a decline in the period.”
Note the reference to “tighter rules restricting spending by gamblers” and the move by the government to charge local residents a fee every time they enter one of the two casinos?
Well, legislation passed last month in Singapore tightened the rules on locals visiting the two gambling emporiums. Could Australia learn from Singapore, especially with Packer proposing locals be barred from his high roller paradise in Sydney?
In the legislation, the Singapore government’s Casino Control (Amendment) Bill empowers “authorities” in Singapore to restrict the entry of “financially vulnerable” individuals in casino gaming centers. The provision as stated in a government press release reads:
“Committees of the National Council on Problem Gambling (NCPG) will be empowered to issue visit limits to local, financially vulnerable casino patrons who visit the casinos frequently. Families and individuals may also apply for visit limits in addition to the current family and voluntary self-exclusion.
“Provisional family exclusion orders can be made if there is a need to act urgently to protect the family from further severe harm. Exclusion orders can also be made if respondents to the orders cannot be located or are uncooperative.”
At present, Singapore locals and permanent residents must pay an entry levy of $S100 (just over $A78) and annual entry levy of $S2000 (around $A1,566) if they want to play in the casinos. In the past 18 months, the government earned $S288 million from casino levies (round $A225 million).
According to some media reports, the upshot of the legislation will be to ban 15,000 more citizens and permanent residents, including low income and unemployed people, from entering the two casinos.
Around 12,000 residents — including the unemployed receiving short to medium-term financial aid from the government — will be barred from the casinos. And there around 3000 public housing tenants who are in rent arrears of six months or more on their state-subsidised rental payments.
These new casino exclusions add to the 28,000 people already barred on government orders from Singapore’s casinos. They include people who are bankrupt or receiving long-term government financial aid. That means at least 43,000 people can’t enter the duo.
That would be much harder to implement in Sydney. Singapore is a market smaller than Sydney, but the government control of its population is much tougher, with everyone needing identity papers to get around.
The Singapore government and its central bank, the Monetary Authority of Singapore, recently strengthened laws to guard against money laundering and to make sure the state’s tough bank secrecy and low tax laws are not being exploited by locals or foreigners. In comments, the government has made it clear the change applies to foreigners who have permanent residency and to those using the casinos. The government wants to make sure the money gambled at the two casinos is “clean” (if that can ever be 100% assured).