The Journal The Authority on Global Business in Japan

MLITT: Concern Remains over Integrated Resorts with Casinos

A proposal for an integrated resorts (IR) Bill sent to the Diet at the end of July provides for the main authority to be ceded to the Minister of Land, Infrastructure, Transport and Tourism.

Four months of discussion and debate, however, have failed to dispel the concerns of citizens, so the proposal stresses the public benefits as “being able to achieve change” through establishing an IR infrastructure based on an overnight-stay tourism model and fiscal improvements would “elevate Japan’s international presence.” Establishing casinos with controls, it is believed, will position them as the world’s best.

A strict licensing system and shareholder controls go so far as to deal with customers with gambling dependence (a point already in force in casinos in the United States and Singapore), and may include restrictions on the number of times Japanese citizens may enter—a unique control not in force in other countries.

In addition to setting up the system, the ultimate mission calls for “changing the landscape concerning IRs.” This includes emphasizing specialized skills needed at the resorts to foster public approval.

Discussion over the regulation of casinos has consumed a great deal of the deliberations, and it was hoped that the discussion of the particulars could boost awareness. But, infighting in the Diet and efforts to keep disagreements low-key have prevented backers from gathering public support.

Numerous other points of contention remain, ranging from admission charges for casino entry to the number of locations that will be designated for IRs.

Japan, Europe agreement to affect 30 percent of world GDP

During negotiations at the EU–Japan Summit in Brussels, Belgium, in early July, Prime Minister Shinzo Abe, European Union President Donald Tusk, and European Commission President Jean-Claude Juncker announced jointly that they had agreed on the general framework for an economic partnership agreement (EPA). When finalized, an enormous free trade entity controlling 30 percent of the world’s GDP—and 40 percent of world trade on a value basis—will come into existence.

Currently while import duties are not levied on about 70 percent of exports from the EU to Japan, some 70 percent of exports from Japan to the EU are subject to duties. Up to now, Japan’s market-opening policies aimed at dropping duties on manufactured goods have met with a number of protective measures on the EU side. A key aim of the Japan–Europe EPA is to eliminate such inequities.

However, at the final stage of the negotiations, the Ministry of Economy, Trade and Industry (METI) put emphasis on agreeing to a wide-ranging framework for the main points of contention in the agricultural, forestry, and fisheries sectors.

METI Minister Hiroshige Seko had favored trade terms similar to those in place between the EU and South Korea, calling for the dropping of import duties within five years. It was decided that the 10-percent duty currently charged on Japanese cars would be abolished within seven years. At the same time, the duty on automotive parts, levied at 92.1 percent on a value basis, would also be abolished. Market access for Japanese fruit producers would still be subject to compromise.

In the background is the growing lack of transparency over the position of the United States concerning the Trans-Pacific Partnership (TPP). Another wildcard is the proposed Regional Comprehensive Economic Partnership (RCEP), in which China and India would participate.

Currently 11 nations are seeking a quick agreement on TPP, while encouraging the United States to return to the fold. China hopes that RCEP—the main focus of which is on dutiable goods—will emerge as a workable trade accord with high transparency, along the lines of the Japan–EU EPA and TPP.

Keizaikai magazine