Japan Should Recall its Long History and Opt to Legalize Casino Gambling

Japan has always effectively balanced acceptance of modern realities with staying true to its national culture. It can do the same while allowing casinos to operate in the country.

The Asian island nation of Japan is one of the world’s oldest and most proud civilizations. Once an isolated kingdom of peasants, then a mighty empire, now one of the world’s leading economic powers, its history is full of contradictions.

Japan has been simultaneously an extremely open and tightly closed society. It has shunned outside cultural influences while borrowing many of its cultural institutions from China; it has rejected Westernism while adopting American and European business practices, technology and clothing and becoming a major consumer of Western pop culture.

But the key to Japan’s success and social stability had been its ability to import foreign goods, practices and investment in a tightly-managed fashion, benefiting from the outside world while remaining distinctively Japanese. In the current day the debate is whether the country should allow in foreign casino investors and operators for the first time. As it always has, Japan can have the best of both worlds.

Japan considers legalizing casino gambling for the first time

• The Japanese government is likely to legalize casino gambling sometime this year

• 20 locations are being considered, but Tokyo and Osaka are the most likely

• Shinzo Abe and casino mogul Sheldon Adelson met in Singapore last May

With a slowly declining economy and surprisingly low tourism revenue for being one of the world’s most admired civilizations, the Japanese Diet (parliament) has been debating legalizing casino gambling for the past year. Its bold, forward-thinking Prime Minister Shinzo Abe has openly supported the idea, seeing it as a way to strengthen the economy and build the country into a major tourist destination, especially as the 2020 Summer Olympics will be held in Tokyo.

Japanese gambling laws currently ban all forms of gambling and sportsbetting except for lottery and the traditional Japanese games of mahjong and pachinko. As Japanese citizens can’t gamble legally inside the country those that can afford to take their business elsewhere, pouring hundreds of millions of dollars annually in casinos in Macau, Singapore, and now South Korea and the Philippines.

Those who can’t afford to travel abroad wager money in online casinos operated in offshore locations like Gibraltar, Malta, the Isle of Man and Antigua. Either way, domestic businesses miss out on a major opportunity and the government fails to rake in potentially massive tax revenue.

The country is missing out even more because its location could allow it to become an international gambling hub. Major cities Tokyo and Osaka are just a short flight from China, the world’s biggest gambling market, and also close to population centers in South Korea and Taiwan. Gamblers in these places generally travel to Macau to play everything from baccarat to bingo, but for many of them Japan would offer a closer destination.

Legalization would mean bringing in foreign business interests

The hotly-debated proposal would be for the government to extend two licenses for the building and operating of large-scale integrated resort casinos. Most likely one of these “special tourism zones” would be located in Tokyo and another in the southern Japanese metropolis of Osaka.

And these licenses (provided that the Diet does as expected and legalizes casino gambling sometime this year) are being competed for by a host of international casino giants. The most talked about name is Sheldon Adelson, chairman of Las Vegas Sands and archenemy of online casinos in the US. Adelson hosted Abe at his Marina Bay Sands resort casino in Singapore this past way with the hope of winning his good favor.

Other international firms like Vegas-based MGM and Caesar’s International as well as Macau operated SJM Holdings and Melco Crown and fighting to get their bids in as well. Any way you slice it, foreign businessmen stand to make billions of dollars off of casino legalization in Japan.

How Japan can let in foreign casino operators without compromising its culture

Many conservative voices in Japan are calling on the Diet to squash the bill, arguing that it would sell the country out to foreign billionaires, attract hordes of unwanted gamblers and increase social problems like problem gambling and underage gambling.

These voices are wrong on all three counts. Japanese leaders have always been able to attract foreign business in a way that benefits the country as a whole. Men like Adelson will bring much-needed expertise into a new market that will desperately need it. Yes, he will make money (if granted a license), but so will his Japanese business partners and the local people employed in his resort casino. Any deal with be done with the partnership of a domestic firm.

As for foreign tourists, casinos are not going to turn Tokyo and Osaka into crime-ridden areas. Far from it. Not only will casinos be located in special zones away from residential areas, but they will attract wealthy businessmen from around the region as well as family-oriented tourists from Europe and America who want to play a bit of blackjack during their Japanese vacation.

As for problem gambling and underage gambling, neither should pose a significant problem. Most casino patrons will be foreigners, the international companies being considered for licenses have stellar reputations for excluding underage gamblers as well as funding organizations helping problem gambling, and most problem gamblers currently in Japan struggle with online gambling, which happens to be illegal anyway.

All-in-all, casino legalization looks to be good gambling news for Japan, and the country should maintain its tradition of bringing in the best of the outside world without losing the things that makes I Japanese.