Cape Verde and Mozambique liberalise gaming laws to attract investors

The new Mozambican law, which has already been approved by the President of the Republic, authorises construction of casinos anywhere in the country, makes it possible to place slot machines outside casinos and also allows for online gaming.

The minimum investment to explore casinos has now been reduced from us$ 15 million to us$ 8 million and the minimum accommodation capacity and classification of associated hotels has also been lowered.

With these moves the Mozambican authorities plan to encourage tourism, creating jobs, public revenues, tax and exchange rate revenues and to complement activities promoting tourism, a sector that is amongst the government’s first priorities for economic growth.

So far, gaming in the Mozambican capital operated on the basis of a monopoly, handed over to Casino Polana, whose main players publically opposed the new law, from the moment it began to be drawn up in 2007.

The previous law outlined the existence of “open door” gaming venues, such as the one in Namaacha next to the border with Swaziland, which has a monopoly within a 75 kilometre radius. Under the terms of the reviewed law, the Tourism Ministry is now responsible for gaming and gambling concession-holders, which were previously the responsibility of the Finance Ministry.

Even before the law was approved the Mozambican authorities had publically called for investment in gaming venues in the country. The Mozambican tourism minister, Fernando Sumbana said at a conference on investment opportunities in tourism in Macau that there was “room for a lot more gaming venues.”

Amongst the operators that have shown interest in investing in gaming in Mozambique are Estoril-Sol, of the Sociedade de Turismo e Diversões de Macau group, which has also looked into the Angolan and Cape Verdean markets.

At the end of last week the Cape Verdean authorities altered the Legal Regime for Gaming and Gambling Exploration, allowing competition in the sector and reducing the amounts payable for opening casinos.

The premium payable by concession-holders was reduced under the terms of the new law. There is now a fixed payment of between 181,381 and 2,394,230 euros and a variable payment that will be paid throughout the concession’s lifetime.

Previously, the law stated that concession-holders had to pay a premium of over 1.8 million euros. The law that is still in force limited casinos to being set up in five-star hotels, but the proposed new law lowers that classification to four stars or more.

The government is working to create the gaming Inspectorate and preparing inspectors, which it is expected to do in cooperation with Macau and Portugal. The Economy, Growth and Competition Minister, Fátima Fialho said that the government proposal aimed to open the sector up to competition, thus encouraging investment in the economy.

In the city of Praia, the capital of Cape Verde, a tourism complex is underway estimated to cost over us$ 210 million, which includes a casino, an international conference and banqueting centre, a 300-room five-star hotel, a business centre, including a financial centre, and 200 apartments and houses.

The resort, which is promoted by Cabo Verde Development Corporation, will be located in the Integrated Tourism Development Zone (ZDTI) of the island of Santiago, in an area of around 200 hectares.

Previously Macau businessman David Chao, who is also linked to the gaming sector, showed interest in investing in a casino in Cape Verde but never went ahead with his plans noting that legislation was too restrictive.