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Casinos may be opened in Crimea

March 28, 2014, 16:04 UTC+3 Alexandrova Lyudmila
© EPA/SOLEDAD CONTRERAS

MOSCOW, March 28. /ITAR-TASS/. Crimea that has recently joined Russia now apparently has chances to become not only a popular resort, but also turn into Russia’s Las Vegas. According to media reports, the Russian government is considering the issue of creating in the new Russian constituent entity a gambling zone, the country’s fifth. Thus, Crimea may earn more money and become less dependent on state subsidies.

The Bloomberg agency reports with reference to sources familiar with the government plans that it had been discussed on March 21 at a government meeting chaired by Deputy Prime Minister Dmitry Kozak who has been appointed the official in charge of Crimea. The Economic Development Ministry, Finance Ministry and Ministry of Regional Development are to present by April 15 a preliminary financial feasibility study for the project.

The Crimean authorities that had already raised this issue when the peninsula had been within Ukraine have supported this idea with enthusiasm. “Crimea should have a gambling zone. Now we are looking for a place for it,” Crimean Prime Minister Sergey Aksyonov said on Thursday.

The ministries are considering this option together with many other ideas on the development of a special economic zone on the peninsula, Kozak’s aide Ilya Dzhus told the RBC Daily. “The idea is that there is no need to stick only to the gambling zone, as all the possible options are being studied,” Dzhus said. According to him, various versions have been proposed during the discussion of the region’s economic development scenarios, and it is impossible to tell yet what final decision will be taken by the agencies.

The creation of a gaming zone in the Crimean Federal District would make it less dependent on state subsidies. Finance Minister Anton Siluanov had noted previously that in 2014 the new region’s budget deficit was expected to reach 55 billion rubles ($1.5 billion), and Russia was planning to fully cover it. The government has calculated that the support of Crimea and Sevastopol would cost 100-130 billion rubles.

The gambling business in Ukraine had been banned on July 1, 2009. Until that time Crimea had been known as one of the centers of the gaming industry with 283 gambling houses operating on the peninsula.

In September 2011, a bill was submitted to the Ukrainian parliament that proposed to legalize casinos in Crimea, but the lawmakers had never got down to it. Then the Crimean authorities were considering two options of the placement of gambling zones. The first provided for the opening of casinos in the largest resorts of the Southern Coast of Crimea — Yalta and Alushta. The second — for creating a gambling cluster in the desert-like northwest of the peninsula in the Chernomorsky and Razdolnensky districts that are regarded as a “depressive zone.” In this case the city of Yevpatoriya, located 70 kilometers to the south, would become the closest resort to the Crimean ‘Las Vegas.’

As for Russia, the gambling business in its new history has had a difficult life. In the 1990s of the past century — the period of the development of the ‘wild capitalism’ in the country — casinos and slot machine halls had literally flooded the country, especially large cities. In terms of quantity they could rival only the currency exchange offices. The number of Russians who ‘got hooked on’ the gaming business that they had not known during the Soviet period, was steadily growing. So, psychiatrists started to raise the alarm, calling for taking measures to fight game addiction that was included in the International Classification of Diseases in the section of mental disorders.

According to the Russian Health and Social Development Ministry, in Moscow alone, more than 300 thousand people had game addition in the middle of the 2000ths. Up to 80 percent of students at some schools had ‘got hooked on’ gambling then.

Against this background, the law banning the gambling business in the whole territory of Russia, except specially designated areas, was passed. Starting from 2009, gambling establishments remained only in four zones - in Altai and Primorsky Krais, in the Kaliningrad region and Krasnodar Krai. And only the latter - Azov City - is actually working at present.

According to the RF Accounts Chamber, the state had allocated more than 1.4 billion rubles for the organization of gaming zones, but the tax revenues from them only by 7% cover the expenses.

After the 2014 Winter Olympic Games, the issue of creating a gambling zone in Sochi was raised, but it has not been supported by the Kremlin. “It’s a rather tempting idea. It’s familiar to everybody, but it does not quite correspond to the spirit and image of a quality resort,” RF president’s press secretary Dmitry Peskov commented on this information.

Vice President of the Gaming Business Association Vladimir Ilyushin doubts the prospects of the creation of the Crimean gambling zone. “Of four gaming zones only one is working today - Azov City - that has only three casinos. This project exists for seven years and still does not yield a profit,” Ilyushin says.

Crimean businesses, however, believe that a gaming zone would increase the flow of tourists to the peninsula. “The accession of Crimea to Russia will change the contingent of tourists coming to us, there will be more Russians among them,” believes co-owner of the Ostrov Krym company, restaurant-keeper Oleg Nikolayev. “And the gambling zone may attract foreigners, for example, from Israel that currently travel to Egypt to gamble.”

 

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