Does Saipan Need More Casinos?

Managaha Island Beach and Pier in Saipan

Saipan is in the western Pacific Ocean, one of the Northern Mariana Islands, a commonwealth of the United States. While the island saw significant success when casinos were originally legalized, it has now run up against some serious issues. As a result, some politicians are calling for more licenses to be issued.

History of casinos in Saipan

One of the important components of Saipan’s economy is the tourism industry. Throughout the 1980s and 1990s, garment manufacturing was also a large source of revenue because the island was exempt from US immigration and minimum wage laws.

This meant that clothes could be manufactured at a very low cost but could still be labeled as made in the United States. While this led to a boom in the local economy, there were problems with working conditions and how workers were treated.

A lot of notable names manufactured clothes on the island but, when textile export quotas ended in 2005, these manufacturing businesses started to close.

The casino industry played a major role in helping to make up for some of the shortfalls after the collapse of the garment manufacturing industry.

There are currently over five casinos in operation. The only casino license is held by the Imperial Pacific International Holdings Casino, a company that originated in China and is listed on the Hong Kong stock exchange.

The company creates and maintains hotels and casinos throughout the islands and is one of the largest taxpayers in Saipan. It was given a 25-year license in 2014 to construct and operate the casinos on Saipan. This included a clause allowing an extension for another 15 years.

With more than $2bn (£1.55bn) wagered every month in the various casinos on the island, this has a positive impact on the local economy.

However, things have not been rosy as of late, and many have called for changes to be made in how the casino industry is structured.

Recent controversies involving casinos

What was supposed to be the crown jewel of the Imperial Pacific International Holdings Group in Saipan, its integrated resort was scheduled to be finished this month.

It will include a casino, luxury hotel, leisure facilities, retail units and restaurants. However, construction has missed numerous deadlines, and the whole project concerns a lot of locals, who are wondering if it is ever going to be in finished. There have been numerous construction delays on the project, along with payroll issues.

There was also the high-profile departure of the company chairman, Marco Teng, who held the position for only seven months. Cai Lingli also resigned as director and chair of the executive committee this week.

Some local politicians are calling for amendments to the existing gaming law that would allow the issuance of more casino licenses. Imperial effectively has a monopoly on the casino industry in Saipan because the company holds the sole license and operates all of the island’s casinos. Competition would likely force Imperial to deliver what was promised, rather than staying in its current comfort zone.

In the past, many countries had gambling monopolies, but this has been changing in recent times, largely because of the popularity of online gambling. Sweden, for example, has recently ended its state-run monopoly by allowing offshore online poker platforms to deal with Sweden-based users.

There are countries such as Norway that try to hold onto their monopolies, but the cost of trying to enforce the rules and block players from using foreign platforms is ever rising and becoming less sustainable.

The fear in Saipan is that, if this project falls through, the entire casino industry will be on its knees because there is no alternative.

With the deadline of August 31, 2018, for the completion of the Imperial Pacific Resort coming up fast and not to be met, the calls for changes in the gambling laws will only grow stronger.

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