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Published: 30 June, 2009, 20:36

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TAGS: Russia, Law, Budget, Economy


Russian gamblers are placing their last bets ahead of a ban that comes into force on Wednesday. The government is closing casinos across the country – and gambling will only be permitted in four specific zones.

The idea to close casinos and move them to special, Las Vegas-type zones in four different parts of the country was promoted in 2006 by then-Russian President Vladimir Putin. He explained his decision as an attempt to end problems in the country with gambling addictions.

“The fact that taxes from this business will not be in the budget is nothing when compared to the financial, economic, moral, psychological and physiological damage from gambling. Much greater damage has been inflicted on the families and players who have not just lost their jobs but, in fact, become seriously ill,” Valery Draganov, a State Duma deputy, told RT.

But people on the streets of Moscow had mixed reactions.

“I think it will save hundreds of lives. People spend enormous money on this. It is a disease of the 21st century. That’s why I am all for it,” a man told RT’s correspondent.

“I don’t think it’s the right move. First of all, they generate a significant tax and I don’t think we should miss out on such an incredible amount. Secondly, those who gamble will continue to do so. They’ll just change the location,” a woman said.

Of the four gambling zones, one is going to be located on the Russo-Chinese border in the Far East; the second one – in Siberia; the third – in the country’s south, not far from the Sea of Azov; and one more in Kaliningrad – the Russian exclave enclosed between EU members Lithuania and Poland.

Initially, the government promised to get the gambling zones ready by the time the law comes into force. However, nothing seems to have been done so far. According to local media sources, there is nothing but empty fields where casinos were promised.

Also, reports claim that no Russian casino companies have yet been tempted to relocate to the zones. As casino owners explain, there is a serious lack of infrastructure in those zones and they would prefer to move their businesses abroad – to Bulgaria, Belarus and other countries in Eastern Europe where potential clients are more likely to come.

The ban will also affect people working in casinos, which is considered to be one of the most, if not the most profitable business in Russia, with $6-8 billion in annual revenues.

Further, some 400,000 people involved in Russia’s gambling industry will lose their jobs, which is an even more negative factor now since the economic crisis is not over.

Lisandro Platzer, an executive Vice-President of Korston Hotel in Moscow explained his view of the situation:

“The biggest problem we have is that there are more than one thousand people who work in this building and who will lose their jobs tomorrow. We will try to relocate some of them to our new location in Montenegro, because the gaming zones [in Russia] are not ready.”

“We already have land in the city of Azov, in one of the zones. But, it is not just the issue of infrastructure. The level of taxes is not clear, as well as the cost of infrastructure – we cannot even draw up a business plan. How are we supposed to operate there? So, we decided to move internationally and bought a hotel in Montenegro, and comes tomorrow we’ll be operating already,” Lisandro Platzer has added.

Another problem is that the country’s budget will lose about $1 billion a year.

Therefore, as of now, it seems that the ban has more negative points than positive. But time will show: the law will come into force in a few hours.

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