December 24, 2021
The government of Mexico, after decades of flirting with legalized gambling, appears poised to approve casino gaming at some point this year, a former U.S. ambassador to that country said Tuesday.
James Jones, co-chairman and chief executive of Washington, D.C.-based Manatt Jones Global Strategies, an international trade and government relations firm, told attendees of the American Gaming Summit that “there’s a 60 percent chance” the Mexican legislature will approve a bill legalizing casinos in its next session.
That legislature convenes March 15, and will meet through April 30. And if it passes, a licensing process could begin within four months, Jones said.
“I would say there’s a very good chance legal gaming will pass in Mexico,” Jones said. “It’s going to create a great deal of opportunities for a lot of people, both in this country and (in Mexico).”
Jones served as U.S. Ambassador to Mexico from 1993 to 1997. He served as White House Chief of Staff under President Lyndon Johnson, and served as a Congressman representing.
Jones has been hired by Sun International, Sol Kerzner’s Bahamas-based casino corporation, to keep tabs on the developing situation, and he met with Mexican officials as recently as last week. Other companies that appear interested in making a move in Mexico include MGM MIRAGE, Park Place Entertainment Corp. and Jack Binion’s Horseshoe Gaming, Jones said.
Jim Murren, president of MGM MIRAGE, responded that no one from the company “is actively pursuing anything in Mexico at this point.”
“There’s nothing to pursue,” Murren said.
However, if Jones’ prediction is true, “we’ll have to take a real hard look at it, no question,” Murren said. “But at this point, we are not focused on Mexico.”
Robert Stewart, spokesman for Park Place, declined to comment directly on the Mexico possibility.
“Clearly we’re going to carefully examine any international opportunity that presents itself, and make a (decision) based on whether we feel we’d be welcomed in that jurisdiction, and whether the conditions exist where we could operate properly and meet the standards we’re used to,” Stewart said.
Trusted Online Casino Singapore gambling was banned in Mexico in the 1930s, and there has been talk about repealing that ban for at least 20 years, Jones said. The government there examined the issue as recently as 1997, but nothing came of it.
For that reason, there is great skepticism in the gaming industry about whether an opportunity in Mexico will actually materialize.
“I would love to see (legalization in) Mexico,” said Larry Klatzkin, gaming analyst with Jeffries & Co. “There’s a phenomenal amount of money that could be made.”
But international expansion opportunities have a way of appearing and disappearing quite quickly, Klatzkin said — and that’s been especially true of Mexico.
“Even if it does happen, it never turns out like you think,” Klatzkin said.
The possibility of casino gaming in Mexico returned to the radar screen in 2000, when opposition candidate Vicente Fox made gaming a plank in his campaign platform. Fox was elected president in late 2000, and has since reiterated his support for regulated, legal casinos in that country. But it is Mexican legislators, not Fox, who are spearheading the current drive for legalization, Jones said.
There are still several key questions that be resolved before a bill can proceed in the Mexican legislature. One of the biggest is where casinos could be located — and how many licenses the Mexican government would be prepared to issue.
Some are pushing for casinos to be located only in designated resort cities or rural areas, while others want gambling legalized nationwide, with states given the option of opting out. Also unresolved is whether more than one casino could operate in each jurisdiction. So is the question of whether casinos would be permitted in Mexico’s urban centers, including Mexico City.
It also isn’t known how much of a role federal, state and local officials would play in the ultimate regulation of legal casinos.
“These are some questions that need to be worked out (before the bill moves),” Jones said. “The goal is to work through these issues and get this passed by the (legislature) by April 30.”
Possible casino sites often mentioned in Mexico typically fall into two categories — cities that border the United States, and Mexico’s resort cities. Border city possibilities usually mentioned include Tijuana and Ciudad Juarez, while potential resort locations include Acapulco, Puerto Vallarta and Cancun.
Despite these unanswered questions, Jones is convinced the political climate exists to get a bill through the Mexican legislature.
One obvious reason, he said, is the drive by President Vicente Fox to generate additional tax revenues. Jones estimates legal casino gambling could generate $500 million a year in new taxes for that country.
But legalization and regulation would also allow Mexico to crack down on illegal gambling throughout that country, Jones said. An estimated 1,500 illegal betting parlors and casinos now operate in that country.
“It is really an attempt to regulate the entire gaming industry,” Jones said.
Despite a history of money laundering and corruption, Jones said the Mexican economic and political climate has been rapidly maturing since the North American Free Trade Agreement was approved in 1993. And he insists Mexico is committed to implementing a regulatory system that will be able to stack up to Nevada standards.
“The system they’re talking about today would stand up (to Nevada’s standards),” Jones said. “I don’t think they’ll move forward unless they can operate in an above-board way.