The Border Casino Case Benefits, Costs and Downsides

Transcription

1 The Border Casino Case Benefits, Costs and Downsides Dr. Johanna Järvinen-Tassopoulos Gambling, Casinos and the Public Good International Research Conference , Ateneum Hall, Helsinki

2 Welcome to Vaalimaa, Finland! Johanna Järvinen-Tassopoulos 2

3 Introduction Finland was among the first Nordic countries to allow landbased casino operation, but it took more than three decades to open the first international casino in Helsinki In 1969, a committee was assigned by the Ministry of Trade and Industry: it was commissioned to find out about the possibilities to operate casino gambling and increase tourism in Finland The Ministry of the Interior set up a working group in February 1990 and the Council of State allowed the Slot Machine Association (RAY) to start casino gambling operation in 1991 Between 2009 and 2011, the national gambling operators anticipated the legislative changes to be made concerning age limits, lotteries, casino gambling, and tote games Johanna Järvinen-Tassopoulos 3

4 RAY wanted to open a second casino in the Eastern Finland: many municipalities offered their premises to the gambling operator, because a casino would boost local economy, create employment and increase tourism A small community (3,452 inhabitants) on the Finnish-Russian border won the competition: it had land for a suitable building project, but nothing else Operating casino gambling on the border raises many questions: a) How to define the socio-economic impact of casino gambling on the community? b) Will the border casino increase tourism and what type of tourism? c) What does cross-border gambling mean from the national gambling policy perspective? Johanna Järvinen-Tassopoulos 4

5 Content Introduction 1. Casinos on the Border: What are the characteristics of border casinos? 2. Data, Methods and Ethics: Articles, comments and opinions published in the Finnish press (2012); content analysis; research ethics 3. Main Topics in the Finnish Press (2012): What were the mains topics (or arguments) in the public discussion concerning the opening of a new casino? 4. The Impact on Vaalimaa Region: How can the border casino case be represented within the Socio-Economic Impact of Gambling Framework (SEIG)? Conclusion Johanna Järvinen-Tassopoulos 5

6 1. Casinos on the Border Why are border casinos different from other land-based casinos? 1) Can gambling be seen as a sustainable economic strategy in a community? 2) Can gambling be categorized as a tourism and leisure activity? (Felsenstein & Freeman 2002) The border is a favorite site for the development of casinos, particularly if a large market exists on the other side. (Felsenstein & Freeman 2002) Border casinos are exploiting the differences in regulatory regimes between neighboring states (Zagorsek & Jaklic 2009) Johanna Järvinen-Tassopoulos 6

7 Gambling tourism and occasional gambling during the visit (Zagorsek & Jaklic 2009) A location on the border is fraught risk (Felsenstein & Freeman 2002) If prohibitions of gambling disappear, tourism-based gambling will diminish as well (Eadington 2001) Export-oriented gambling (Zagorsek & Jaklic 2009): some Slovenian casinos are for foreign tourists (Italians) only Problem gambling: self-exclusion from the local casino does not mean that the gambler is excluded from the casino on the other side of the border (Järvinen-Tassopoulos 2010) Johanna Järvinen-Tassopoulos 7

8 2. Data, Method and Ethics Data: Articles, comments and opinions published in the national press between August and November 2012; many regional newspapers commented the Eastern casino project Method: Content analysis Ethics: I was allowed to use RAY s press archive for my study on casino operation in Finland. Special thanks to Anssi Airas, Hannu Rinkinen, Anu Hyvönen, Elina Huumonen and Mari Kauppinen Johanna Järvinen-Tassopoulos 8

9 3. Main Topics in the Finnish Press (2012) Competition for the casino: Location: About 15 to 20 municipalities competed with each other for the Eastern casino only a few of them were revealed in the press. Some of them had premises ready a casino and others offered to build a hotel and a spa near the casino. The chosen location (Vaalimaa, the Finnish-Russian border) provoked a heated debate in regional newspapers: some municipalities were disappointed and challenged RAY s decision. The winner (municipality of Virolahti) was more than excited. RAY explained that location is a key issue in casino business. The border region was seen as a potential business area Johanna Järvinen-Tassopoulos 9

10 Casino gamblers: Russian tourists were seen as potential customers, because they were represented wealthier than the local residents and there are no land-based casinos on the other side of the border. Employment: Job creation was much anticipated both in the border region and the surrounding areas. The shopping center, in which the casino will be opened, was seen as a major employer in Virolahti Johanna Järvinen-Tassopoulos 10

11 Vaalimaa Shopping Center (VSC): The shopping center will be financed and built by Russian investors. The fear of these investors culminated in mistrust and objections in several articles and comments. Later the names of the board members of VSC were published. Local business: Despite the chosen location, some investors and municipal officials were confident that there would be enough revenues from Russian tourism to benefit other regions as well. Virolahti was represented as a future business center which would happily welcome new investors Johanna Järvinen-Tassopoulos 11

12 Finnish gambling policy: Surprisingly the casino debate did not focus on the gambling monopoly system. The border casino was seen as a way to increase gambling revenues in the name of the public good. The future of the Finnish gambling monopoly system would depend on EU regulation. Beaten municipalities: The socio-economic impact on the beaten municipalities was also discussed in the Finnish press. Some municipalities had to change their visions on tourism and business possibilities. On the other hand, there has been negotiations concerning the consolidation of municipalities (Virolahti, Miehikkälä, Hamina): perhaps other municipalities will also benefit from casino operation Johanna Järvinen-Tassopoulos 12

13 4. The Impact on Vaalimaa Region (SEIG) The Socio- Economic Impacts Economic & Financial Legal & Justice Employment & Education Culture Health & Well-Being Recreation & Tourism Benefits Tax revenues; Business investments; Tourist expenditures Consolidation of municipalities; Exemption from visa? Job creation in the community; Reopening of the local school More gambling revenues for the beneficiaries Entertainment; Leisure; Spa Tourism; Gambling tourism; Leisure; Shopping Costs Housing production; Roads; Architecture; Design Customs; Gambling monopoly system at stake Daycare; Teaching Russian language in Finnish schools; Job creation in Russia Tourists have expectations! Downsides Lack of Investment in the shopping center project; Untrustworthy business partners Money laundering; Crime; Prostitution Not enough tourists for the other regions Johanna Järvinen-Tassopoulos 13

14 Conclusion A border casino seems to be a challenge for the gambling operator and the community as well Its socio-economic impact is wide: it may benefit several small communities, but casino operation will also cost to the region From a regulatory point of view, border casinos are interesting cases especially when gambling operation is restricted or prohibited on the other side of the border The Finnish public discussion (highlighted by the press in 2012) seemed to react in a quite positive way to the opening of a casino in the Vaalimaa area It is too early to say if casino operation will benefit the municipality of Virolahti: it depends on business investments, tourism, customs and visa policy between Finland and Russia Johanna Järvinen-Tassopoulos 14

15 In the Western world gambling is already a leisure activity: combined with shopping, staying in hotels, relaxing in a spa and discovering new cuisines, what else can it be? Nevertheless, Russia has many neighbors which already welcome Russian gamblers to their premises Will EU tolerate cross-border gambling in the case of disagreement on problem gambling between two member countries or one member country and a non-member country? The Vaalimaa case needs to be studied further: there are a lot of questions concerning the future of Finnish gambling policy and regulation that should be answered! Johanna Järvinen-Tassopoulos 15

16 THANK YOU! Johanna Järvinen-Tassopoulos 16

17 References Eadington, W.R. (2001). The Spread of Casinos and Their Role in Tourism Development. In D.G. Pearce & R.W. Butler (Eds.) Contemporary Issues in Tourism Development. London, New York: Routledge, pp Felsenstein, D. & Freeman, D. (2002). Gambling on the Border: Casinos, Tourism Development and the Prisoners Dilemma. In S.Karkover & Y.Gradus (Eds.) Tourism in Frontier Areas. Oxford: Lexington Books, pp Järvinen-Tassopoulos, J. (2010). Les jeux d argent: un nouvel enjeu social. Pensée plurielle 23(1), pp Zagorsek, H. & Jaklic, 21 (2009). Resort Casino Development and Its Linkage to National and International Tourism: A Slovenian Perspective. In W.R.Eadington & M.R. Doyle (Eds.) Integrated Resort Casinos. Implications for Economic Growth and Social Impacts. Reno: University of Nevada, pp Johanna Järvinen-Tassopoulos 17