Gambling in special economic zones has done little for country, deputy PM says
Laos will no longer grant new concessions for casinos in special economic zones on its soil. It will also overhaul plans for such areas so they have a clear focus and right direction for economic development, Deputy Prime Minister Somsavat Lengsavad said in an interview recently.
“Casinos in special economic zones such as the one in Boten (in the north) have made no good contribution to development and even affected relations between China and Laos, so we don’t want them anymore,” Somsavat said.
The idea to end casino concessions in special economic zones came with a plan to review new economic zones in Laos as there had been confusion and ineffective regulation, he said.
The casino in Boten lured a lot of Chinese gamblers to the small border town. But it was a source of crime in the border area. China asked Laos to shut the casinos down in 2011 after news reports that Chinese gamblers were held hostage to repay their debts.
The end of the casino in Boten special economic zone would have some impact on the entire zone as there was no magnet to attract people to that area, Somsavat said.
“So we need a new plan, my idea is to turn it to something like an international conference centre or eco-tourism,” he said.
Laos currently has 10 special and specific economic zones around the nation and had planned to have as many as 49 by 2020. “The plan exists but we don’t need to rush and I want to improve and refocus on the existing 10 first,” he said.
“Special Economic Zone” stands for a zone with many economic activities on more than 1,000 hectares (6,250 rai) on land, while a “Specific Economic Zone” is a smaller area for a specific industry.
“Looking back to what we have done over the past years, our economic zones were not good enough for economic development as we were not ready for many aspects including policy, regulation and management,” he said.
There was no clear form of investment in special economic zones, compare to many neighboring countries such as China and Vietnam, he said. In China, the government invested in the zone while Laos sometime gave concessions to foreign private firms and sometime partly invested, he said.
In areas such as Savannakhet, the government offered a plot of land as its capital for investment and foreign groups put up cash for infrastructure development for their part, he said.
There was also a casino in Savan-Seno special economic zone in the southern province, but the government wanted to re-focus on industrial production from now on, Somsavat said.
Companies that produce or manufacture items such as jet aircraft parts, automobile assembly and lenses were about to start operations in Savannakhet, he said.
But he noted that the casino would be allowed to remain until the end of its concession.
“Industry is a good trend in Savannakhet, so that we have to review everything in other existing special economic zones to have the right direction and a clear focus for them,” he said.
The government would review all details about the existing zones, he said and noted that such “details” included management, protection of labour and social welfare for workers.
In order to do this, the Lao government has set up a secretariat under Somsavat himself to oversee and review plans for special economic zones. He expected to spend more time to finish that task.