At the cabinet meeting last week, the government pressed ahead with a major initiative to stimulate the economy by approving the legalisation of casinos under the cloak of an "entertainment complex".
Critics of the decriminalisation of gambling intensified their efforts after former premier Thaksin Shinawatra remarked at a seminar that online gambling should also be legalised to bring underground businesses into the formal tax system, citing its potential to generate 100 billion baht annually.
The Digital Economy and Society (DES) Ministry announced it is gathering data from relevant stakeholders to determine the most effective approach for regulating online gambling.
As the entertainment complex proposal is presented for reading at the House of Representatives in the next stage, civil society groups have rung the alarm, warning that the liberalisation of gambling, packaged as part of the entertainment complex project, could have serious social consequences unless accompanied by stringent regulatory controls.
Many fear the benefits of the project will disproportionately favour a small group of influential investors, while the broader societal costs may outweigh the economic gains.
An illegal gambling den in Nonthaburi is raided in a police crackdown.
WEAK LAWS AND ENFORCEMENT
Sisdivachr Cheewarattanaporn, president of the Association of Thai Travel Agents, said with the cabinet already approving a draft law to legalise gambling and casinos, it might be difficult for civic groups to object at this stage.
However, he said the government cannot neglect these voices, particularly concerns over detailed regulations in the draft as well as law enforcement, which has traditionally been a weak point for the country.
"Political parties should think about the good of the country. Each party shuffles through periods of power, but the laws they pass continue to affect the country for a long time," said Mr Sisdivachr.
Even though many business sectors view legalised casinos as directly benefiting the tourism industry, in reality not many tourists would travel to Thailand for this specific purpose, he said.
Some governments are concerned about their citizens travelling to destinations known for gambling, said Mr Sisdivachr. If Thailand fails to properly regulate both online and physical casinos, the country could risk undermining the reputation it built over many years, he said.
Mr Sisdivachr said one of the most sensitive issues is ensuring legal gambling is not a vehicle for money laundering.
The government should also strengthen enforcement against illegal gambling dens, particularly if legal casinos are established as part of the entertainment complex project, he said.
Sanan Angubolkul, chairman of the Thai Chamber of Commerce, said the chamber perceives the government's entertainment complex policy mainly as a strategy to increase tourism, with gambling just one component.
The effects of the policy, both positive and negative, need to be thoroughly discussed, said Mr Sanan. The government should work to educate the public on the project and seek feedback from all parties involved, he said.
Mr Sanan stressed measures are needed to prevent children and youth from gambling, while the investment criteria and other details require further consideration as the legislative proposal only received cabinet approval in principle.
A network of anti-gambling advocacy groups raise awareness about the entertainment complex proposal, fearing benefits for only a small group of investors. Chanat Katanyu
TOURISM BOOST
Many countries generate huge sums annually from entertainment complex businesses, he said.
Singapore, Vietnam, Laos and Myanmar earn up to several hundred billion baht annually from this sector.
For Thailand, if the government successfully implements the entertainment complex project, the chamber and the University of the Thai Chamber of Commerce initially estimate casino operators could generate 69.6 billion baht, accounting for 0.7% of GDP.
The government is projected to earn 36.1 billion baht in revenue, with the project creating total income of 106 billion and employing more than 70,000 people, according to the study.
Mr Sanan said case studies from countries such as Singapore show significant economic impacts. In 2022, entertainment complexes accounted for 4% of Singapore's GDP and created 20,000 local jobs.
Based on these studies, the Thai chamber believes if the government manages entertainment complexes prudently, they could significantly improve the economy, he said.
Moreover, expanding investments to secondary cities could stimulate urban development, improve infrastructure and distribute income to provincial areas, said Mr Sanan.
For example, Las Vegas, a remote, economically insignificant desert town in the early 20th century was transformed into a global casino and entertainment hub.
This model could serve as a reference for Thailand, ensuring the country maximises the benefits of the project, he said.
Tourism operators urge the government to take a cautious approach to legalising casinos and online gambling.
ECONOMIC ACTIVITIES
Pornchai Thiraveja, director-general of the Fiscal Policy Office (FPO), said although casinos and gambling may not directly impact the economy because they simply redistribute money from losers to winners, the related economic activities that follow can significantly contribute to GDP.
He said construction of an entertainment complex, with an investment of about 100 billion baht and a timeline of three years, is expected to contribute 0.08 percentage points annually to GDP for three years.
Once operational, the entertainment complex is projected to add 0.2-0.4 percentage points to GDP annually due to increased per-trip spending by foreign visitors.
During the construction phase, funds should circulate thanks to increased jobs, leading to increased consumption, said Mr Pornchai.
When the entertainment complex opens, he said spending should accelerate in the service sector as foreign visitors buy goods and services unrelated to gambling, such as hotels, restaurants and visiting other entertainment venues.
"While private consumption is expected to increase as Thai tourists purchase goods and services unrelated to gambling within the entertainment complex, private investment may also rise with the construction and improvement of the complex and the expansion of related businesses in the future," said Mr Pornchai.
Hotels and restaurants, transport and logistics, real estate services, rentals and business services are all expected to benefit from an entertainment complex, according to the FPO.
He said an entertainment complex should increase spending per trip for foreign visitors based on the uptick observed in Singapore.
A 5-10% increase in foreign tourists compared with the baseline would result in economic growth of 0.2-0.4 percentage points annually above the baseline, noted the FPO.
According to Mr Pornchai, the economic impact of an entertainment complex on sectors, ranked from greatest to least, is as follows: hotels and accommodations; trade; restaurants and eateries; entertainment and recreational services; and electricity, which would benefit from expanded investment activities.
However, the FPO emphasised the need to consider other impacts, particularly social effects.
ROOT OUT THE UNDERGROUND
Amonthep Chawla, chief economist at CIMB Thai Bank, said legalising underground businesses would generate additional tax revenue for the government.
"Underground or informal businesses are not always illegal, but they don't pay taxes. Legalising these businesses means bringing them into the formal tax system," he said.
In addition to tax revenue from operators, the government can also earn income tax from the millions employed at such underground businesses, said Mr Amonthep.
Krungsri Securities (KSS) said the details of the online gambling draft are expected to be finalised by the DES Ministry within a month.
Online gambling has expanded by 7.3% a year, according to the brokerage. If this business is brought into the formal tax system with efficient safeguard measures in place, it would benefit the overall economy, said KSS.
"This initiative is projected to bring 3 trillion baht into the system, while mitigating risks related to youth and crime. It could also drive investment in related systems," noted the brokerage.
Data compiled by Statista estimated the value of online gambling in Thailand at US$546 million (roughly 19.6 billion baht), projected to rise to $674 million (about 24 billion baht) by 2028.
NEW REVENUE SOURCE
The plan to develop an entertainment complex should support the tourism industry and bring more revenue to entrepreneurs across various sectors, said Kriengkrai Thiennukul, chairman of the Federation of Thai Industries (FTI).
The construction sector would be the first to benefit, with higher demand for construction materials and workers, he said.
Once the complex is complete, other industries related to tourism and activities at the venue are expected to offer goods to visitors at the complex, said Mr Kriengkrai.
Thailand has drawn foreign tourists with the idyll of "sea, sun and sand", but these magnets are insufficient to further promote tourism, he said.
"We need to build man-made landmarks as have Singapore, Malaysia and China to attract tourists and encourage them to spend more," said Mr Kriengkrai.
Up to 35 million tourists visited Thailand last year, which was healthy for the tourism and service sectors, but individual spending was low, he said. Mr Kriengkrai said he wants tourist spending of more than 40,000 baht per person per trip.
A complex with a casino can help the government stimulate spending, he said.
"There are many groups of tourists, some of which like gambling. Many Thais are fond of gambling and travel to neighbouring countries to do so. If we operate a casino under strict laws, we can prevent billions of baht flowing to other countries," said Mr Kriengkrai.
This can be a method to lift the sluggish Thai economy, he said.
The Joint Standing Committee on Commerce, Industry and Banking recently issued its forecast for GDP growth of 2.4-2.9% this year, compared with projected growth of 2.8% in 2024.
Growth this year will primarily be driven by the tourism sector, with an anticipated 39 million foreign arrivals, along with government stimulus measures in the second half of the year, according to the panel.
Export growth is projected at 1.5-2.5% this year, down from 4% last year, while inflation is estimated at 0.8-1.2%, rising from 0.4% in 2024.
LOCATION DECISION
"I believe an entertainment complex would appeal to foreign tourists, either for gambling or for entertainment options," said Thaniwan Kulmongkol, president of the Thai Restaurant Association.
Establishing such a complex could draw in tourists, increasing the potential for revenue, but she expressed concerns about the management of gambling.
Mrs Thaniwan supported the complex primarily targeting foreign tourists who enjoy games of chance.
She said casinos could enhance tourism in destinations with fewer attractions.
Thailand has several tourist destinations with either natural attractions, such as beaches, or man-made attractions.
If the government pursues this initiative, Mrs Thaniwan suggested the complex be situated away from crowded hotspots such as Pattaya.
"Thailand's tourism landscape is imbalanced, with most tourist activities concentrated in destinations such as Pattaya and Bangkok's Old Town," she said.
Thailand should explore options in less crowded cities, learning from the success of Las Vegas, said Mrs Thaniwan.
She proposed the entertainment complex be situated in the Northeast to help stimulate the economy there.
Basic infrastructure is essential in the complex area, including airports, as gamblers will prefer convenient transport options, said Mrs Thaniwan.