Thailand deputy PM: Casinos can be a hedge against Trump tariffs
As opposition to the Thailand Entertainment Complex Bill continues, deputy prime minister Phumtham Wechayachai says the industry is even more vital to compensate for US trade losses.
US president Donald Trump stunned governments around the globe last week with the announcement of sweeping new tariffs. Ranging from a baseline of 10% to more than 50%, they are designed to return manufacturing to the US and stop it from getting “ripped off” by the international community. Analysts say the levies, affecting more than 60 trade partners, could be the first shot in a global trade war, potentially leading to a global recession.
Asian markets have been hit particularly hard. The 36% tariff on exports from Thailand could mean $15 billion (£11.7 billion/€13.7 billion) in losses. According to the Thai Examiner, that means “any hope of meaningful economic or GDP growth in 2025 may be dashed”.
Enter casino resorts, which could produce gross gaming revenue (GGR) of $9 billion to $15 billion per year, potentially making Thailand the world’s third-largest market after Macau and Las Vegas.
Critics oppose casinos as a pathway to crime and gambling addiction. But, in Phumtham’s words, “This isn’t about encouraging gambling – it’s about economic survival.”
Pros and cons of casino resorts
The administration of prime minister Paetongtarn Shinawatra supports entertainment complexes with gaming as a way to boost tourism, attract international investment and create jobs.
The proposal has won approval in the cabinet and is due for review by parliament this week. If approved, it would legalise casino resorts in four locations: Chiang Mai, Chonburi, Phuket and Bangkok.
But the proposal has sparked widespread opposition, including street protests.
In an open letter to parliament on 6 April reported by the Bangkok Post, 50 former drafters of the 2007 Thailand constitution said the casino bill was not part of the ruling Pheu Thai party’s campaign agenda. They claim former prime minister Thaksin Shinawatra, Paetongtarn’s father, is the man behind the curtain, advancing his own interests.
The letter urged members of parliament to reject casinos, which could bring social costs including crime and addiction.
In one January poll, 59% of respondents said they oppose the complexes, with just 29% supporting them. In addition, more than 58% strongly opposed legal online gambling and fewer than 20% said they strongly supported it.
The deputy PM points to another survey, conducted by the Fiscal Policy Office (FPO) during a public comment period. It reportedly found that 80% of 70,000 participants support casino resorts. Former election commissioner Somchai Srisutthiyakor has questioned the reliability of the FPO poll. It showed that 57,500 of 71,303 respondents gave nearly identical answers, with 80.6% to 80.75% of people saying yes to each of eight questions.
“Even from Mars, the result looks improbable,” Somchai said. “Yet the cabinet believes it.”
Paetongtarn has “strong plan” to mitigate tariff
Last week, Paetongtarn sought to reassure the public that her government has “a strong plan” to address the looming tariffs. “We have prepared several steps, including sending our permanent secretary to talk with [the US]. I think we can still negotiate,” she said.
Olu Sonola, head of US economic research for Fitch Ratings, told MSN’s MarketWatch the tariffs “are a game-changer, not only for the US economy but for the global economy. Many countries will likely end up in a recession. You can throw most forecasts out the door, if this tariff rate stays on for an extended period of time.”
The US is Thailand’s largest market for electronics, machinery and agricultural products. Its trade surplus with the US totalled $45 billion last year, according to the Office of the US Trade Representative.
In comments in the Post, a reader scoffed at the assertion that casinos could offset billions in trade losses.
“What rubbish!” wrote the anonymous poster. “Is the average Thai rice farmer going to be given training and support to work as a croupier in a casino while he is unable to sell his rice crop at a reasonable price? The answer is no!!! And that should be the response and vote to the casino entertainment complexes bill: NO!”