China creates blacklist of overseas gambling destinations
The country will impose travel restrictions to stop Chinese citizens from visiting overseas gambling destinations.
China.- Asian gambling hubs have been stunned to learn that China intends to blacklist tourist destinations where Chinese citizens go to gamble.
China’s Ministry of Culture and Tourism said it had decided to introduce a blacklist system after noting a rise in the number of outbound Chinese tourists travelling to overseas to gamble.
It said this was disrupting China’s outbound travel market and endangering citizens’ lives and property.
The ministry said that, together with several other departments, it will impose travel restrictions on Chinese citizens who attempt to visit destinations on a list of blacklisted destinations, Xinhua agency reported.
It is not yet clear which countries or destinations will be included on the list, but JP Morgan analysts expect it to target the Philippines, Cambodia and Vietnam, while favouring the Chinese SAR of Macau as a tolerated gambling destination for Chinese high-rollers.
JP Morgan’s DS Kim, Derek Choi and Jeremy An said: “At this stage, it’s difficult to know exactly how the government will clampdown and what it means by ‘black-listing’, but we suspect capital flows through underground banks and agents, as well as junkets’ promotion of these overseas markets, will be heavily scrutinized.”
They also added that less affected markets could include Australia, Singapore South Korea and Malaysia.
“In the long term, this move could be seen as ‘ring-fencing’ gambling demand/flow within China, which in turn could drive repatriation of demand to Macau,” they said.
The move is the latest chapter in China’s crusade to control capital outflows since it identified the cross-border flow of funds for gambling as a national security risk and potential channel for money laundering.
Earlier this year, China set up an online whistle blowing platform, while it has raided illegal gambling rings across the country in recent months.
