Crimea Seeks to Become Next Las Vegas
Published: April 22, 2014 (Issue # 1806)
Crimea's plans to become the world's next Las Vegas have received the blessing of President Vladimir Putin, who presented a bill to the State Duma that could transform the formerly Ukrainian peninsula into Russia's fifth official gambling zone.
Crimean authorities proposed the idea originally and are convinced of its commercial prospects. A Crimean gambling center "stands a good chance of becoming a competitor to such sophisticated territories as Macau, Monaco and Las Vegas," Crimean Deputy Prime Minister Rustam Temirgaliev said Monday, PRIME reported.
Separate plans to create a special economic zone on the peninsula will help raise Crimea to the level of these ritzy competitors, Temirgaliev said. Prime Minister Dmitry Medvedev announced earlier this month that Russia will establish a special economic zone on the annexed peninsula, offering special tax breaks and trimming red tape in an effort to attract investors.
There are two possible models for the gambling zone, Temirgaliev said: either they will create a special gambling city in the popular resort area of Yuzhny Bereg, or they will allow "specially prepared tourist complexes" across Russia to run their own casinos.
According to Putin's bill, it is up to the Crimean authorities to determine the borders of the zone. They will also choose which of the above models to implement, said Viktor Zvagelsky, deputy head of the State Duma's Economic Policy Committee.
The gambling zone, like the special economic zone, is intended to lift Crimea "at least to the average Russian level, socially and fiscally," without requiring additional state funds, Zvagelsky said.
A gambling zone could make a major difference to the region's budget, especially given the pivotal role that tourism plays in the Crimean economy, he added. Azov-City, the single functioning gambling zone in Russia, brought in 140 million rubles in taxes last year ($3.9 million), of which 120 million came from the zone's three casinos. "So you can understand how profitable this is for a region's budget," Zvagelsky said.
In a statement last week, the Regional Development Ministry estimated that creating an integrated entertainment-tourism cluster in Crimea would bring an additional 600,000 tourists a year to Crimea and Sevastopol and add about 1 billion rubles ($28 million) to state coffers. Prior to the Russian annexation, the peninsula hosted about 3 million vacationers yearly.
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