Regional casinos: a safe bet or a long shot?

Regional casinos: a safe bet or a long shot?

the Middle East region positioning itself as a global gaming hub and go-to destination for casino giants.

While the legalization of gambling in the Middle East has long been a topic of fierce debate, news of industry developments in the UAE have now put this contentious issue firmly back in the spotlight. Against that backdrop, Ralph Nader, CEO of Amber Consulting, assesses the odds of the region positioning itself as a global gaming hub and go-to destination for casino giants.

In a significant stride toward diversifying its entertainment sector, the UAE made headlines on September 3, 2023 by unveiling its General Commercial Gaming Regulatory Authority (GCGRA) through the state news agency, WAM. While the UAE has historically upheld strict anti-gambling laws rooted in Islamic principles, the setting up of the GCGRA signals a potential paradigm shift. The authority’s mandate is to craft a comprehensive regulatory framework encompassing lottery gaming and commercial gambling. Significantly, the UAE is tapping into the experience of seasoned US industry veterans to oversee the project, appointing former chairman and CEO of MGM International, Jim Murren, as chairman and the attorney and lobbyist Kevin Mullaly as CEO, whose combined expertise spans more than three decades. These appointments form part of a broader aim to create a gaming environment that is responsible, well-regulated and adheres to stringent guidelines, while nurturing economic growth, as reported by WAM. The bold initiative also aligns with the UAE’s broader vision to expand its entertainment and hospitality offerings.

Shifting global perceptions

From a regional perspective, questions are now understandably being asked as to what this development means for gaming and gambling in the Middle East. Certainly, the setting up of the GCGRA represents a significant milestone and shift in approach in a region historically known for its strict anti-gambling policies. Looking ahead,
it paves the way for the Middle East to establish itself as a potential destination for gaming and entertainment enthusiasts, changing traditional perceptions and reshaping its global image in a field ripe for economic growth.

Rethinking tourism strategies

Bloomberg analysts have estimated that legalizing gaming in the UAE could generate an additional USD 6.6 billion in annual revenue, based on the assumption that the industry is capable of generating 1.6 percent of national GDP, as it does in Singapore. Currently, tourism accounts for 9 percent of the UAE’s GDP, with the country continuing to enjoy its status as a magnet for visitors, having welcomed over 15 million tourists in 2022. The rising numbers of arrivals are among the key indicators that gaming could potentially become a significant contributor to the country’s economy.

The government’s recent announcement marks the UAE’s first step toward further diversifying its vibrant entertainment and hospitality sector through the introduction of commercial gaming, signaling a strategic shift that offers potential for significant revenue growth and presents exciting industry prospects.

A key question now is whether the UAE’s initiative will inspire other tourism-focused Middle Eastern countries to reevaluate their approaches. With growing competition, these nations may perceive the GCGRA’s actions as a challenge to the allure of their own, individual tourism sectors. Analysts will be watching with interest for any signs that these destinations are considering easing their anti-gambling regulations or perhaps exploring alternative strategies to harness new revenue sources and retain their edge in the global tourism arena.

International resort opportunities beckon

From a global standpoint, accessing markets like Macau and Singapore has become virtually unattainable and is likely to remain so for at least the next decade. Consequently, the Middle East has an opportunity to position itself as the world’s most attractive untapped casino market to date, led by the UAE in particular, assuming approval is given for gaming. This appeal is further heightened by the UAE’s substantial per-capita wealth, driven by its vast oil reserves, which help to make it one of the wealthiest nations globally.

The year 2009 saw MGM Resorts International and the investment firm Dubai World team up for the USD 9.2 billion CityCenter project, located on the Las Vegas Strip, in a partnership that sparked speculation about possible UAE interest in using casinos as a means to boost tourism industry revenue.

The implications of establishing a gaming regulator in the UAE have long been the subject of speculation. In January 2022, Ras Al Khaimah set up its Department of Entertainment and Gaming Regulation under the Ras Al Khaimah Tourism Development Authority – a move that was not only seen as a bold step toward bolstering the emirate’s entertainment and gaming sector, but also noted for its timing, which coincided with an announcement by Wynn Resorts, a renowned US-listed luxury resort developer, of ambitious plans for a multibillion-dollar integrated resort situated locally on Al Marjan Island.

Regulatory amendments in the pipeline?

Even prior to the GCGRA announcement, Craig Billings, the CEO of Wynn Resorts, enthusiastically referred to the UAE as “the most exhilarating emerging market in decades.” The group anticipates a substantial boost from the development in the near future, citing high expectations of significant growth. What remains unclear is how the GCGRA will operate within the current anti-gambling legal framework and how other Middle Eastern nations with similar laws will respond. Amendments to these regulations will likely be required to govern this booming sector effectively.

The UAE’s decision to set up its GCGRA has undoubtedly put the Middle Eastern market on the radar of international resort operators, notably those with a strong presence, such as Las Vegas resorts, following in the footsteps of Wynn and MGM Resorts. This strategic move undoubtedly not only sets a precedent, but also ensures that these industry giants and other key players will be keeping a close watch on new developments in the region and assessing related opportunities. Their foray into the Middle East will be instrumental in laying the groundwork for a potentially transformative period in the region’s gaming and entertainment industry.

Ralph Nader
Amber Consulting

For more articles, click here

Add to Favorites
About author

Rita Ghantous

Rita Ghantous is a hospitality aficionado and a passionate writer with over 9 years’ experience in journalism and 5 years experience in the hospitality sector. Her passion for the performance arts and writing, started early. At 10 years old she was praised for her solo performance of the Beatles song “All My Love” accompanied by a guitarist, and was approached by a French talent scout during her school play. However, her love for writing was stronger. Fresh out of school, she became a freelance journalist for Noun Magazine and was awarded the Silver Award Cup for Outstanding Poetry, by The International Library of Poetry (Washington DC). She studied Business Management and earned a Masters degree from Saint Joseph University (USJ), her thesis was published in the Proche-Orient, Études en Management book. She then pursued a career in the hospitality industry but didn’t give up writing, that is why she launched the Four Points by Sheraton Le Verdun Newsletter. Her love for the industry and journalism led her to Hospitality Services - the organizers of the HORECA trade show in Lebanon, Saudi Arabia, Kuwait and Jordan, as well as Salon Du Chocolat, Beirut Cooking Festival, Whisky Live and other regional shows. She is currently the Publications Executive of Hospitality News Middle East, Taste & Flavors and Lebanon Traveler. It is with ultimate devotion for her magazines that she demonstrates her hospitality savoir-faire.

Your email address will not be published. Required fields are marked *