PM Anwar denies Malaysia Govt talks with tycoons on Forest City casino

JOHOR BAHRU, MALAYSIA: Is Malaysia considering allowing a casino to operate within the US$100 billion Forest City project in Johor?

Bloomberg reported on Thursday (25 April) that Prime Minister Anwar Ibrahim met with Berjaya Corporation founder Tan Sri Vincent Tan Chee Yioun and Genting Group chairman and chief executive Lim Kok Thay in Forest City in mid-April.

The report claimed that Sultan Ibrahim Iskandar of Johor, who commenced his five-year term as Malaysia’s King in January, was also present.

However, Prime Minister Anwar swiftly refuted the Bloomberg report, denying that his administration was considering the idea of issuing a second casino license in the country.

Bloomberg suggests significant government income from proposed gambling hub

According to Bloomberg’s report, the inclusion of a casino could potentially benefit Forest City, a sprawling development of high-rise condominiums constructed on reclaimed land by the Chinese developer Country Garden Holdings Co.

However, the project has faced challenges in attracting residents from China and other regions due to various obstacles, including political opposition in Malaysia, Chinese government restrictions on citizens purchasing overseas real estate, and the COVID-19 pandemic.

The report suggests that the addition of a casino could serve as a positive development for King Ibrahim, who is himself a billionaire businessman.

King Ibrahim reportedly holds more than 20% control of the joint venture with Country Garden, which acts as the master developer of Forest City, according to company filings.

PM Anwar refutes Bloomberg report

In fact, any efforts to establish another casino in Malaysia could pose a challenge for Anwar and potentially jeopardize the stability of his coalition government in this predominantly Muslim nation.

Given that gambling goes against Islamic principles, and Muslims are prohibited from entering Malaysia’s casinos, the introduction of a new gambling establishment could face significant opposition from religious groups and conservative segments of society.

The gaming industry in Malaysia is heavily regulated, with casino licenses requiring renewal every three months, subject to the discretion of the finance minister—a position currently held by Anwar himself.

However, Bloomberg highlighted that a new gambling hub could generate substantial revenue for the government.

Before the pandemic, the existing casino contributed approximately 5 billion ringgit (US$1 billion) annually, as reported by UOB Kay Hian, a brokerage firm based in Singapore.

Lim Kok Thay serves as the chairman of Genting Bhd, a company with a rich history in Malaysia’s gaming industry. His father, Lim Goh Tong, secured approval in 1969 to establish Malaysia’s inaugural casino, situated in a hill resort in the country’s central region. Beyond Malaysia, Genting also operates casinos in various countries such as Singapore, the US, and the UK.

Vincent Tan’s business interests span across diverse sectors, from real estate development to the operation of renowned brands like 7-Eleven and Starbucks in Malaysia.

Despite harbouring long-standing aspirations of obtaining a casino license in Malaysia, Tan has faced rejection on at least two occasions.

King Ibrahim holds a direct stake in Berjaya Assets Bhd., while his daughter chairs both Berjaya Corp. and the rail unit of Berjaya Land Bhd.

In January, Anwar and his Singaporean counterpart Lee Hsien Loong witnessed the signing of the Johor-Singapore Special Economic Zone (JS-SEZ) Memorandum of Understanding (MoU) between their respective countries.

Last September, Johor Menteri Besar Datuk Onn Hafiz Ghazi announced plans for the establishment of the JS-SEZ, drawing inspiration from the successful model of the Shenzhen Economic Zone in China, which achieved a remarkable Gross Domestic Product (GDP) of RM1.93 trillion in 2021.

Last August, Forest City, a sprawling mixed-use development situated on four artificial islands in Johor’s western waters, was designated as a Special Financial Zone (SFZ).

This designation entails allocating over 2832.79 hectares within Forest City to the SFZ, aimed at attracting foreign investment and fostering economic growth in the region.