In the past six months, discussions about the legalization of gambling in Thailand have been heating up, with the government's proposal to legalize casinos aimed at boosting tourism and economic growth. The plan includes the construction of integrated entertainment centers, physical casinos, and the regulation of online gambling, but this policy has sparked intense debates nationwide.
Supporters believe that legal gambling can attract foreign investment, create job opportunities, and increase fiscal revenue through taxes, seen as a crucial measure to revitalize the economy. However, the proposal has also faced strong opposition from religious groups, civil organizations, and even within the ruling coalition. Prime Minister Padongdan Sinawa even faced a no-confidence motion in parliament, although he narrowly survived, the controversy has not subsided.
Critics warn that the legalization of gambling could lead to increased addiction problems, a rise in crime rates, and even undermine social cohesion. The Governor of the Bank of Thailand, Sethaput Suthiwartnarueput, has publicly expressed concerns, believing that this policy could put Thailand in a "gray area," lacking transparency and ethical standards, affecting the country's image among international investors.
He suggests that Thailand should prioritize the development of low-risk, high-value-added industries, such as health tourism and elderly care, to align with the country's long-term development strategy. This warning is not unfounded, as Thailand has long struggled with the problem of the gray economy. World Bank data shows that in 2007, Thailand's informal economy accounted for 57% of GDP, although it has declined in recent years, the shadow economy remains a significant concern for the country.
The issue of the gray economy is particularly prominent in Thailand, with Bloomberg Businessweek once ranking Thailand as the seventh largest shadow economy in the world, with illegal gambling being a significant component. Experts point out that due to vague regulations, decentralized technology, and the anonymity of cross-border transactions, gray market casinos are difficult to track.
Thailand's lack of a comprehensive legal framework for gambling has allowed underground gambling networks to thrive with cultural and social acquiescence, and techniques such as cryptocurrency payments and offshore operations further increase regulatory difficulties. Religious conservatism, royal sensitivity, and the stigmatization of gambling also allow illegal gambling platforms to quietly expand.
In response to this situation, some experts believe that the government's proposal to limit casino floor space to within 10% of the total built area of integrated resorts is a cautious and feasible plan, balancing moral considerations and promoting economic growth.
However, they emphasize that Thailand must learn from the successful experiences of places like Singapore and South Korea, establish a transparent regulatory system, strict anti-corruption mechanisms, efficient digital compliance management, and lead with the hotel and tourism industry to achieve a balance between economic and social benefits.
Moreover, historical experience shows that when the supply of legal gambling is insufficient, the underground market will fill the gap. Therefore, Thailand must establish an independent regulatory body, formulate clear tax policies, strengthen public education to reduce the stigmatization of gambling, and utilize technologies such as artificial intelligence to enhance digital supervision to avoid repeating past mistakes.
The legislative process of gambling legalization not only concerns the economy but also involves social impacts. GPEC data from 2021 shows that the gambling participation rate among Thais aged 15 and above is as high as 59.6%, with online gambling users skyrocketing from 800,000 in 2019 to 2 million in 2021, and the market size soaring from 20 billion Thai Baht to 100 billion Thai Baht.
More concerning is the issue of youth gambling, with an expected participation of over 4 million Thai youths in online gambling by 2024. If online gambling lacks clear legal definitions and strict regulation, it could potentially become a gray area, leading to tax evasion, consumer rights violations, and the proliferation of illegal activities. While casino legalization may bring short-term revenue to Thailand, the lack of a robust governance system could exacerbate the country's long-standing informal economy issues, costing society a higher price.
