Farm Town

Some news on First Cagayan from Bloomberg. Look at the story — it says just one licensed casino in the Cagayan freeport is drawing $13 million of bets a day. Phew!

It’s 11 p.m. and inside an office building on the northeastern tip of the Philippines a dozen people place wagers on blackjack and baccarat. No matter how much they bet, none of the gamblers will win — or lose — a thing.

They are all proxy bettors, making wagers on behalf of patrons who track the action and issue instructions from outside the country by way of a live Internet link.

“There is no place like this in Asia yet,” said Kan Goh, general manager of Eastern Hawaii Leisure Co., which operates the casino in Santa Ana, a town of 20,000 fishermen and farmers.

Cagayan Freeport, a 12-year-old special investment zone that includes Santa Ana, is using the gaming provisions in its charter to chase a slice of the estimated $12 billion wagered over the Internet each year. The zone is the first Asian jurisdiction to legalize online casinos, giving it a head start in the race to lure the region’s bettors.

The zone targets Chinese gamblers who helped Macau overtake Las Vegas as the biggest casino market last year, said Jose Mari Ponce, chairman of Cagayan Freeport, who rented his office to Eastern Hawaii as a temporary home. Harrah’s Entertainment Inc. and MGM Mirage, the largest casino operators, so far have failed to persuade the U.S. Congress to let them take Internet wagers.

RA 9487

Republic Act No. 9487, the law extending Pagcor’s franchise, was signed by Philippine President Gloria Macapagal-Arroyo June 20th. If you recall, this bill (House Bill 3409)  was approved on Feb. 19 during Congress’s special session.

The law extends Pagcor’s franchise, expiring on July 11, 2008, by another 25 years. The key provision is that instead of just having the right to run casinos, Pagcor now has “authority to operate and license gambling casinos, gaming clubs, and other similar recreation or amusement places, gaming pools, etc.”

Earlier Supreme Court jurisprudence had nullified a Pagcor contract with the now defunct Sage, with the high court finding that Pagcor had the authority to operate, but not sub-franchise its franchise.

Another key provision is that Pagcor must “obtain the consent of the local government unit that has territorial jurisdiction over the area chosen as the site for any of its operations.” Previously, Pagcor was not legally required to get the LGU consent, though in practice it did.  

What’s the Chinese Word for Tsunami?

Here are some statistics we picked up from an Internet site on how many more Chinese are traveling abroad, leaving the Communist paradise to experience life in other locales. And as everyone will tell you, this massive wave of Chinese tourism, already lapping at the shores of Southeast Asia, is just beginning. Assuming those hordes of tourists want to spice up their vacations with a little action at the gaming tables, does the region have enough casinos?

Mainland tourists are a new and growing phenomenon, in Bali and the rest of Asia. As their incomes soar and Beijing loosens restrictions on foreign travel, China’s middle classes are venturing eagerly beyond the Middle Kingdom. Last year, the number of Chinese trips overseas rose to a record 35 million, up from 620,000 in 1990, according to China’s national statistics bureau. About half were to destinations in Southeast Asia.

Hong Kong has been the biggest beneficiary of this trend. Last year, visitors from the mainland accounted for 13.6 million — more than half the 25 million total outside arrivals to the former British colony.