Well-known casino tycoon Sheldon Adelson is bidding for a Japanese resort casino license and has been aided by President Trump, it is claimed. However, it appears that this influence might not be enough for him to win this bid.
ProPublica has reported that Trump allegedly helped Adelson, a major donor to Republicans, in his bid for this casino during a meeting with the Japanese prime minister, Shinzo Abe, in February 2017.
The publication claims that the issue of American casinos being allowed to develop in Japan was discussed. This was at a time when casinos were just being legalized in the country.
In particular, it was reported that Trump had pushed the case of the Las Vegas Sands group, which is owned by Adelson, who has been described as a “mega-donor”, because of the millions of dollars he has donated to numerous conservative candidates over the years.
Adelson is said to have given more than $20m to Trump’s presidential campaign, as well as providing an additional $5m to aid the festivities during the inauguration.
The day before Trump met with Abe, he had dinner with Adelson, although there is no indication that the topic of casinos in Japan was discussed.
How Did People React?
ProPublica’s claims are unconfirmed, but many people are concerned that it could prove to be true. It is generally deemed to be inappropriate for these sorts of private matters to be discussed during a meeting of this magnitude.
Usually, these meetings are scheduled so that matters of, for example, national security and other bilateral issues can be discussed.
There is also an ethical argument at play regarding a president helping a donor in their business dealings with another nation. It is possible, of course, that Trump may have just mentioned American casinos as a whole rather than one in particular.
In response to the allegations, a representative of Citizens for Responsibility and Ethics in Washington said: “While there are times that it is appropriate for the president to promote business interests, it must be for the benefit of the American people, not his personal relationships.”
The source for the ProPublica report was an alleged insider. The article claimed that the Japanese were surprised to hear Trump bring up the issue. It is alleged that Trump pushed Abe to strongly consider the Las Vegas Sands bid for the license.
The day after Trump met with Abe, Adelson himself met Abe over breakfast with a number of American CEOs, including a couple who are also involved in the casino sector.
Adelson appears to be confident that his proposal will be successful. He is claiming that this bid is currently “in pole position” to win the license. It is yet to be determined what sort of influence Trump could have in the decision-making process.
Japan is seen by many as being the last truly massive untapped market for casinos, and is thus clearly coveted by the likes of Adelson. While Macau is, of course, part of China, an opening up of mainland China for the casino sector is a dream that is unlikely ever to come to fruition.
Three licenses are up for grabs in Japan to build integrated resorts and all of the major casino operators are looking to grab one for themselves.
The development of these casinos will cost in the region of $10bn each. The bidding rules state that the casinos would need to provide extensive facilities for the hosting of conventions.
This is something that Las Vegas Sands actually does very well in, having been the pioneer for these types of events in the casino sector. Despite this, MGM Resorts International still claims that it operates a greater amount of convention space than Las Vegas Sands does.
What Is the Likely Outcome?
Prime Minister Abe has commented on this controversial topic, saying that President Trump did not intervene on the behalf of a particular US company and that even if he had, it still would not be part of the consideration process.
The Japanese government adviser on these issues, Toru Mihara, said: “The party that makes the decision on selection of the [IR] investor/operator is the local government, and the central government can never exercise any influence over that decision.”
Mihara pointed out that so-called political pressure is overhyped by the media and that, in reality, it does not bear any influence on the decision-making process in Japan.
As the casinos awarded these licenses will need to work closely with many other companies in the region, it will be more important that they can manage those relationships rather than simply knowing people in power.
Adelson does have a reputation for speaking his mind, which may be something that goes against him, especially given that Japan is a society that places a lot of value on consensus and cooperation.
It will certainly be fascinating to see who ends up being awarded the three licenses.