Shinzo Abe's best bet for Japanese revival may rest with casinos

As investors place bets on Prime Minister Shinzo Abe's programme for economic growth, the success of Japan's revival plans may rest, oddly enough, on casinos.

For more than a decade now, Las Vegas Sands chief Sheldon Adelson and his counterparts have salivated over bringing gambling tables to Asia's richest nation. Abe is nudging lawmakers to legalise casinos to help boost gross domestic product. With analysts estimating Japan's gambling-resort market will be worth US$40 billion a year by 2025, it seems like a safe bet.

But Abe faces tough odds winning lawmakers over. Worries that casinos will do more to enrich organised crime and create a generation of gambling junkies than raise living standards run deep. That's why investors view this debate as a test of Abe's ability to restructure the economy. What are his chances? Decent, but not great. Abe must work harder, and need a dollop of luck, if he's going to engineer the Las Vegas-isation of Japan.

In some ways, this whole argument about the social ills of gambling is silly. Japan has long been awash in pachinko, lotteries, and betting on everything from horse, boat, bike and motorcycle racing. Japan engages in the fiction that gambling is illegal when in 2012, pachinko (a kind of vertical pinball machine) had US$186 billion in revenue. Japanese like to think their nation is bookmaking-free, just because they walk around the back to collect their winnings, as opposed to a counter inside an establishment.

Getting this bill near the parliament floor is a breakthrough for what could soon be the second-biggest gaming market in Asia after Macau. It would mean more jobs, visitors, consumption and, in turn, a more internationalised Japan as Tokyo prepares to host the 2020 Summer Olympics.

"Integrated resorts are expected to provide a great contribution to tourism, regional economies and industry, I think, and can be one of the key elements of Japan's growth strategy," Abe said in an interview on Tuesday.