Government to Tentatively Legalise Gambling for Vietnamese
For the first time in Vietnamese history, Bloomberg reported, local residents above the age of 21 and with a stable income will be allowed to gamble during a three-year trial phase starting in March 2017. The government’s paradigm shift is thought to be motivated by a growing national debt.
As part of the pilot plan to generate national revenue, casinos will open their gates to Vietnamese, and betting on horse and dog races, as well as soccer matches, will become legal. As of now, only foreigners are allowed to gamble in Vietnam.
The government has seemingly overcome their fear of what officials call “social evils” associated with gambling, like prostitution, drunkenness and destitution.
Keeping Money in the Country
The reason for this fundamental change of mind is simple: experts have calculated that Vietnamese gamblers spend $800 million every year in foreign institutions. With two decrees issued by Prime Minister Nguyen Xuan Phuc this year, Vietnam’s government clearly intends to keep gamblers in their own country.
“They need tax revenues,” stated Alexandre Legendre, partner at Vietnam-based Leadco Legal Counsel, succinctly. Last year’s national growth rate was indeed lower than expected, state-owned oil companies earned less and the country’s agriculture suffered from droughts lately, especially in the otherwise so fertile Mekong Delta.
National debt is estimated at 64 percent of the country’s gross domestic product, according to the World Bank – a huge difference to neighbouring states such as Thailand (41 percent) and Malaysia (56 percent).
$13 Billion from Lottery Tickets from 2011 Through 2015
Between 2011 and 2015, Vietnamese spent around $13 billion on lottery tickets, usually sold at VND 10,000 each by elderly and poor people wandering through Vietnam’s streets. According to statistics from the Ministry of Finance, the revenue growth from lottery tickets during those five years reached an average 12 percent.
The Southern Lottery Council even reported their sales to have tripled in the 21 provinces they serve since 2007.
A High Potential Market
In view of these numbers, it is not astonishing that the government sees potential in stepping up Vietnam’s legal gambling opportunities. Many Vietnamese are enthusiastic about these prospects, and several foreign investors have already announced their interest in the Vietnamese casino market.
However, the first investment groups to be granted licenses to build casinos accessible to the local population on the southern island Phu Quoc and the northern island Van Don are Vietnamese: Vingroup JSC and Sun Group.