Prior to the COVID-19 global health pandemic making regulatory progress impossible and essentially paralyzing all industries and activities, Brazil was reportedly on the brink of legalizing casinos.
The bill, which already has the support of the President of the Chamber of Deputies Rodrigo Maia and the Vice President of Brazil Hamilton Mourão, could be significant for the casino sector within Uruguay given how crucial Brazilian players are in the region.
Brazilian players in Uruguayan casinos are so important for Enjoy Punta del Este that it has an office in São Paulo, where regular charter flights depart to the tourist casino. This means that Uruguayan facilities would lose a significant percentage of their visitors if Brazil decided to allow its own legal casinos.
“We must not be oblivious to the developments that are taking place in our neighboring countries, especially the gambling legalization in Brazil. We should analyze the impact that it has in Uruguay and come up with policies to retain those players,” said Luis Gama, former head of the National Directorate of Lotteries and Quinielas of Uruguay (DNLQ) to SBC Americas sister site SBC Noticias.
In late 2019, several bills were introduced to regulate casino resorts in tourist areas of Brazil. One of them was PL 5783 from Deputy Afonso Motta, who argued that “half of the players in Uruguayan casinos are Brazilian.” Gambling is already happening in Brazil, but the government doesn’t see any of the economic benefits as the neighboring country does.
Gama believes that the new administration must pick “a complementary policy, not a competitive one.” The expert stressed the importance of developing a collaborative policy with the Brazilian government to counter the direct consequences of the loss of players, and particularly the VIP sector.
“The new scenario will require a lot of effort not to perceive a decline in activity in those border and tourist places where the participation of foreign players is key to sustain the business,” he explained.
Considering that the tourism industry will suffer major consequences due to coronavirus, executives should not overlook opportunities. Latin America would be able to join forces to help weak economies once reactivation policies are in place.
Meanwhile, Brazil faces the uncertainty of not knowing where it stands. President Jair Bolsonaro’s erratic actions while facing the pandemic could lead to a change of authorities. He has lost significant support after undermining the threat of the virus and, consequently, he’s trying to stay close to the evangelical sector —his main support group— by rejecting any project that legalizes gambling. However, Brazil is considering the removal of the president.
On the other hand, Uruguay is focusing on the achievements made in the online segment, based on the policies established under Gama. In regards to physical casinos, the first step towards a more competitive position was obtaining the parliamentary approval of the draft bill that enables operations of casinos on cruise ships arriving in Punta del Este or Montevideo.