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China Considering Legal Gambling on Hainan Island

According to several sources, China is drafting a proposal to allow gambling on Hainan Island.  Gambling is currently illegal in China except for the special administrative region of Macau and Hong Kong. China Considering legal gambling on Hainan Island could drastically change gambling in all of its territories.

government agencies Considering Legal Gambling on Hainan For the Hainan island which is China’s southernmost point, this could mean a shift in its economy.  According to sources familiar with the gambling talks, online gaming, lottery and sports betting may become allowed on Hainan Island. These talks are being made by government agencies under a reform party group that is headed by President Xi Jinping.

The southern province is currently facing a fiscal deficit. In addition, it is having to contend with debt problems from the HNA Group Co.

The legalization of gambling would bring a much needed revenue boost to Hainan Island which is mainly known for its beautiful beaches and for being a jump point for its naval and air force patrols.

This is not good news for Macau which is experiencing some problems in its gambling sector.  Casino stocks in Macau have recently taken a tumble.  This include Wynn Macau Ltd., MGM China Holdings Ltd., and Sands China Ltd. stocks which have begun to drop.  If China legalizes gambling on Hainan, it is a certainty that the number of people going to Macau will decrease.

What Legalizing Gambling in Hainan would mean for China

In addition, the proposal would include relaxing rules on visas and building a new airport on the island to draw more foreign tourists.  If gambling is allowed, the new international airport would be built in the area of Donggan city which is located on Hainan’s west coast.  This would bring the total of international airports on the island to four.

Hainan has already been working on improving its infrastructure with new highways, high-speed railways.  It has also been attracting popular hotel chains like Hilton and Weston in order to attract more tourists.  This has not helped their economy much as most Chinese tourists prefer to go abroad.

One of the reasons China may make gambling legal on Hainan Island has been because of the recent crackdown on illegal gambling.  One such example was when more than 10 employees of Crown Resorts Ltd., were arrested in 2016 for illegally promoting gaming.

In China, it is against the law to open casinos, organize gambling, run lotteries, profit from gambling.  Also against the law are setting up online betting websites and market overseas casinos to Chinese citizens.

Sportsbook software companies also note that by legalizing gambling, it would allow China to keep more revenue from leaving the country.  It would also ensure that gambling revenues would benefit its economy.

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