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Integrated Resorts: Two Sides of a Coin
Concerns over the social costs aside, the Integrated Resorts will certainly benefit Singapore, economics professor Winston Koh tells Challenge. - By Susan Tsang
Since the government first mooted the idea of Integrated Resorts (IRs) in Singapore, the topic has generated heated discussion, with those opposed fearing the social costs while others were keen to have theme parks and casinos within a convenient distance. Now that Resorts World Sentosa (RWS) has opened, with Marina Bay Sands Resort due to follow soon, a clearer picture is emerging. Singapore Management University Professor of Economics, Winston Koh, observes that people are excited enough by Universal Studios Singapore to express frustration when some of the best rides were not yet operational by March. “To have such a theme park in your backyard – there’s the novelty factor, and it offers a place where you can spend a day and have a good time,” he says. Prof Koh is the author of a paper on “An Integrated Resort-Casino for Singapore: Assessing the Economic Impact” for the IPS (Institute of Policy Studies) Forum on The Casino Proposal. Certainly, according to him, the IRs have their advantages. “They make Singapore a more exciting tourist destination, and make us compare better with, say, Hong Kong, which has Disneyland,” Prof Koh says. Jobs, Revenue and Buzz
The casinos will generate more jobs and revenue for the country, as Singaporeans who normally play overseas flock to the new premises at home. Gamers from abroad will also boost income. And with Sands promising Las Vegas-type entertainment when it opens, the IRs will add a spark to the urban environment, in the same way the Esplanade did. “There will be a positive buzz,” says Prof Koh. “It makes Singapore a more interesting place to live and work.” On the negative side, there could be social issues: think of gambling addicts getting their families into debt, and retirees losing their shirts. Prof Koh’s view is that there are already avenues for people to gamble, including Toto, the Turf Club, cruise ships, and slot machines, “so it doesn’t mean that IRs worsen the problem”. He points out that the government is moving to make sure the casinos have on-site counseling. There are also timeout rooms for players to cool down, and prominent signs reminding patrons not to lose control. “The effort of controlling problem gambling should remain a high-level responsibility, not just now, but in the future,” he says. “The casino will affect some people’s productivity, and from news reports, it is clear that there has been an increase in the reported incidence of gambling addiction. While this is worrying, we should also be mindful that for every person who is negatively impacted, other people may enjoy their day at the IR, and be energised,” Prof Koh notes. “Singaporeans sometimes complain they have nothing to do. If they can have a day at RWS and relax, it may help to increase their overall productivity.” Foreign Competition?
Still, he admits things could get ugly if there is severe competition between the resorts to maximise profits, and they push the gaming side of the business hard. IRs are never about the restaurants, facilities or shows, which are loss leaders. The real money – in some cases, over 50% of revenue – is generated from gaming, which subsidies the other operations. Also, crime syndicates, loan sharking and prostitution come with the territory. “It suggests the need for more law enforcement resources,” says Prof Koh. “I’m speculating that there will be more undercover people about, to nip this sort of thing in the bud.” Perhaps Singapore will be able to minimise the downside of the gaming industry. However, other countries in the region are studying the...