My report on Singapore’s decision to license two Malaysian junket promoters is in the April issue of Macau Business. Buy the magazine at fine news dealers throughout Macau and Hong Kong or look for it online at Macau Business Digital later this month, where every issue is archived.
I’m currently in Macau for the opening of Sands Cotai Central and will cover the event for Asia Times. I’ll post some further impressions here after that article is published.
Singapore Business Review also asked me to comment on the city-state’s initial licensed junket operators, or as Singapore’s Casino Regulatory Authority prefers International Marketing Agents (IMAs). The article was posted this week with my edited comments and those of other experts this week.
Here’s a full transcript of my comments to SBR:
“The decision to license two small junket promoters reminds me of Singapore bringing in the Crazy Horse topless show. It’s a way for the authorities to provide evidence that they’re willing to take risks through a virtually meaningless gesture.
What’s most revealing is that eight years after the authorities decided to embark on casino legalization and two years after the first casino opened its doors, with no licenses granted to junket promoters and thus no experience of seeing how junkets would operate in Singapore, the regulator thought that it needed to issue more stringent rules. That belies the common notion of Singapore as a well-run, transparent jurisdiction with smart people in charge.
Licensing more junkets would relieve the official schizophrenia over high rollers. On one hand, Singapore taxes their gaming revenue at 5 percent [vs 15 percent for mass market play], but on the other hand, it won’t license any agents to bring them to the casinos. Throughout Asia, junkets are an important part of attracting VIPs – casinos can’t duplicate junkets’ overseas outreach efforts and range of services. As veteran gaming consultant Mike Gore told me, “Junkets work hard for their money.” They know their market, they know their customers, and they speak their language. All of that matters.
Having more junkets doesn’t mean being less particular about who gets licensed, but it does mean doing the job faster and more efficiently. Right now, applicants need to supply vast amounts of information including a 40 page application form with no guarantee of a timely response. Surely, the government can do better than that.
The casinos have always been about bringing in foreign high rollers, so you’d hope the authorities would get more proactive about it. Rather than just sitting around waiting for applications and processing them at the glacial pace, why not reach out to honest businesses in related fields and encourage them to become IMAs. There may be some regulatory hurdles, but why not consider having junket promoters linked to overseas branches of DBS or Singapore Airlines? If you want an honest casino industry, then encourage honest companies to find ways to participate scrupulously and profitably.
For that same reason, Singapore should publish comprehensive gaming revenue statistics, as Macau does, to help other companies better understand what’s happening in the casinos and where the opportunities may be.”
Totally globalized native New Yorker and former broadcast news producer Muhammad Cohen is author of Hong Kong On Air, a novel set in his adopted hometown during the 1997 handover about television news, love, betrayal, financial crisis, and cheap lingerie. See his biography, online archive and more at www.muhammadcohen.com.