The Cape Town International Convention Centre : a positive economic impact created through the legalisation of gambling

[摘要] ENGLISH ABSTRACT: The legalisation of gambling in South Africa was perceived by many as anunnecessary vice that would bring social decay in a country that is already battling tocope with a wide array of social woes, such as unemployment, crime, etc. Antigambling protestors argued that South African society is not sufficiently developed tocope with an industry that diverts money from normal household budgetaryexpenditure patterns to the many forms of gambling that suddenly became legal.Protestors also argued that gambling tax is just another tax on an already overtaxedsociety. Many of these arguments were justified and the legalisation of gambling wasclearly an issue, which had to be dealt with carefully.Politicians, the custodians of a well-managed political system through pro-activepolicies that will be to the benefit of a country and its people were in a particularlydifficult position with the creation of a legalized gambling industry and had to weighpolicy between the advantage of additional tax revenue and the disadvantage ofadding to the social ills of South African society. In terms of the Constitution of SouthAfrica gambling was a concurrent competence and the respective provinces had anopportunity to develop gambling policy that will be beneficial to the relevantprovince. Although the national Gambling Act provided the broad parameters inwhich provincial legislation had to be developed, provinces had ample opportunity tobe innovative in respect of provincial gambling legislation.After the legalisation of gambling provinces moved quickly to ensure that casinoswere developed, mainly to create a larger revenue base through gambling tax. Mostprovinces were cash-strapped, as their share of the national budget was not sufficientto deal with the long list of provincial development priorities. A way had to be foundto supplement the national government contributions and gambling tax was anattractive option.The Western Cape Province moved somewhat slower in the promulgation ofprovincial gambling legislation. There was a clear realisation that gambling was goingto have a massive social impact on the population of the Western Cape and thereforehad a clear objective to find ways to develop casinos in such a way that it wouldoffset the negative impact of gambling.This thesis did not place any emphasis on the quantification of the social impact (suchas lack of productivity, loss of employment, bankruptcy, domestic violence, divorce,etc). The objective was to show that the allocation of a gambling licence could beused to create infrastructure that is not linked or related to a casino. Suchinfrastructure is normally in high demand in cities or regions, which are emerging astourist destinations, but the infrastructure would not be developed by the government,as the capital cost is too high, nor by the private sectors as the profit margins are toolow.The Western Cape used its allocation of five casino licences in terms of the NationalGambling Act to create an impact on the whole of the region by dividing the provinceinto five regions and allocating a casino licence to each of the regions. Since 1994 Cape Town and the Western Cape have gained prominence internationallyas a tourist destination. It was soon clear that the city and region would not be able tocope with the influx of tourists due to a lack of hotel rooms and other tourisminfrastructure. It was also clear that the tourism industry would not show the requiredgrowth without facilities, such as a convention centres. It is particularly a conventioncentre that became an urgent element in Cape Town as convention business hasbecome a rapidly growing business with a potentially significant impact in terms ofconvention expenditure and the resulting economic impact on a city.The Western Cape developed gambling policy determinations made it clear that in thecase of the five regions, casino bid companies were obliged to include tourisminfrastructure that would add value to a particular region. It was made clear that suchinfrastructure should not necessarily be linked with a casino and could be off-site. Thepolicy determinations were clear in its stipulations that stand-alone casinos would notbe entertained in the adjudication process.The development of an international convention centre became an important criterionin the allocation of a casino licence in the Cape Metropole. Although casino bidcompanies included different kinds of infrastructure in their bids (mostly projects thatwould have a positive impact on tourism) the development of an internationalconvention centre became a strong factor and the casino licence for the CapeMetropole was allocated to the company that included the development of aninternational convention centre in the their casino bid application.Although convention centers are rarely profitable they are known to change the faceof cities and regions in terms of their economic impact, not only the impact in termsof urban renewal opportunity, but also attracting domestic and internationalconvention center delegate expenditure and the expenditure on hotels, food andbeverage, transport, and general tourism expenditure. The direct, indirect and inducedeconomic impact of this expenditure in the Western Cape and Cape Town result in theoff-setting of the negative social impact and ensure that the benefits of the legalisationof gambling is extended to projects that would be unlikely developments in theabsence of a casino licence allocated.The study undertaken demonstrates the economic impact (direct, indirect andinduced) of the Cape Town International Convention Centre. It also shows the impactof the center on the promotion of tourism, including convention center delegatesreturning to the Western Cape for leisure purposes in the future. It culminates in theconclusion that the allocation of a casino licence should not only be the developmentof a stand-alone casino, but also the creation of tourism infrastructure that offsets thenegative impact of gambling.

[发布机构] Stellenbosch University