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Integrated resorts are gaining a fast foothold across Asian countries eager to boost tourism, and Sri Lanka is now mulling whether to raise its stakes in casino development

 

 

In a bid to attract high rollers to the fledgling tourism industry, the Sri Lankan government has plans to introduce high-end casinos into the country through three integrated resort (IR) projects in the capital, Colombo, although efforts have been thwarted by a strong Buddhist clergy and opposition parliamentarians.

 

Protests urging the government to ban upmarket casinos have been held around the site of Australian casino mogul James Packer’s resort in Colombo. The other two IRs are by John Keells Holdings (JKH), owner of Sri Lanka’s largest hotel chain; and businessman Dhammika Perera, owner of three existing casinos. 

 

The government has bowed to the protests and approved the three resorts sans casinos. Unofficial JKH sources said the company is proceeding with its resort with or without a casino, which is just a small part of the resort compared with its 2,500-pax convention centre. The other two resorts declined to comment.

 

Some inbound trade players believe that the emotive protests seem out of place in Sri Lanka, which already has five casinos in Colombo, albeit mostly for foreigners, as well as hundreds of horse racing betting shops. 

 

“We need the casinos,” said Mahen Kariyawasam, president of Sri Lanka Association of Inbound Tour Operators. “And if one is to argue about morals and cultural norms, what about the existing casinos and many betting shops?” 

 

Chandra Wickramasinghe, chairman, Connaissance De Ceylan, agreed: “There is nothing new to complain about; we have been having casinos. Only now the sector is being enhanced with more facilities.” 

 

Wickramasinghe argues that Sri Lanka needs to attract all kinds of travellers, especially if the country is aiming for 2.5 million tourists by 2016, up from below 500,000 in 2009. The casinos can be used to attract the very rich niche gambling segment whose patrons come in on special carriers, he opined. 

 

Luxe Asia executive director, Chaminda Dias, remarked: “If we are to attract 2.5 million tourists, we need to provide something in Colombo which will always be the centre of tourism, and huge benefits come from casinos. (We are told that) the new upmarket casinos will be well regulated and would be strictly for foreigners, so there won’t be much of a cultural or moral impact.”

 

Said Athula Amarasekera, an urban planner and director at Singapore-based Design Team 3 with several projects in Sri Lanka: “Casinos have branded and developed themselves as comprehensive MICE locations than mere casinos, which add value to the city as a destination.” 

 

 

More nightlife options needed

Another issue, Kariyawasam pointed out, is Colombo’s dearth of night attractions and entertainment options, which is needed to cater to the steady growth of Indian, Chinese and South Korean visitors. 

 

Hapugoda concurred: “We need to attract the rich Chinese and Indians with all-night shopping and high-class restaurants.”

 

Amarasekera added: “Cities like Dubai and Bangkok are major tourist destinations without casinos but they have other major attractions including iconic architecture, quality shopping, world-class restaurants or river rides. In Colombo, you get bored after one night.”

 

Indeed, most tourists visiting Sri Lanka rarely visit Colombo or spend just a day or two in the capital, which is about 30km from the international airport. Hotels drawing mostly business travellers often complain about the lack of nightlife in the city, where there are just a few nightclubs and pubs, and most restaurants close by 23.00. 

 

Furthermore, according to official figures, 75 new hotels will be constructed in Sri Lanka in the next three years with a total of 5,300 rooms, of which 2,080 will be in Colombo. Queried a government spokesperson: “When we reach 10,000 rooms (in the next few years – registered and unregistered) in the city, what would tourists do at night?” 

 

Welcoming the government’s move to develop McCallum Road (where two of the controversial IR projects are to be located) as an exclusive leisure, recreation and entertainment zone, Surath Wickremasinghe, Colombo-based urban planner and president of the Chamber of Construction, opined: “We are building hotels at a rate. There are hundreds of new rooms coming up in Colombo but where are the entertainment facilities, a prerequisite for tourists?” 

 

 

In the footsteps of neighbours

The success of Singapore, which gradually allowed casinos after years of reluctance, has also been cited by the authorities to counter public criticism. Said Srilal Miththapala, former president of Tourist Hotels Association and now a tourism consultant: “When Singapore found tourism growth slowing down, it realised the need for new products to stimulate and rejuvenate tourism. The two casinos have jump-started Singapore tourism, which is growing exponentially again.” 

 

Malin Hapugoda, managing director of Aitken Spence Hotels, agreed: “If we are expecting to bring in many tourists then we have to follow markets with the emerging casino sector. Even Muslim Malaysia has casinos.” He suggests Sri Lanka follow Singapore’s example of charging local residents entry fees to the casinos to discourage gambling. 

 

Apart from Singapore, IRs are already a vital component of tourism development in several Asian countries including Macau, Malaysia, South Korea and a likely new entrant, Japan.

 

South Korea forbids its citizens to gamble at casinos (except at an inconvenient location south-east of Seoul) and currently has 16 foreigner-only casinos. Meanwhile, Resorts World Jeju is scheduled to open in stages from 2017, with owner Genting Singapore expecting to break ground in 3Q2014. 

 

Over in Japan where lotteries, pachinko and betting on horse and boat races are already legal, the government is also close to legalising casino gambling ahead of the 2020 Tokyo Olympics to boost tourism. Prime minister Shinzo Abe last month visited Singapore’s two IRs, where he was quoted as saying gaming has achieved great success there, and Japan would need to consider policies to prevent crime and gambling addiction, as Singapore has done. 

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