Spain still dreams of mega-casino despite U.S. probes

 

U.S investigations have not dampened enthusiasm for Las Vegas Sands Corp in Madrid and Barcelona, as the cities vie to host a gambling complex the casino firm claims will trigger a jobs bonanza in a country where one in four is out of work.

Regulators in the state of Nevada are investigating if Las Vegas Sands broke bribery laws in China, 2 sources said earlier this month.

That follows 2 existing probes by the U.S. Department of Justice and the Securities and Exchange Commission.

Authorities in Spain's 2 biggest cities are taking a hands-off view of the probes, mindful of the boost that the Eurovegas casino project and its estimated €15 billon of investments would bring to an ailing economy whose Achilles' heel is Europe's highest unemployment rate.

Madrid Mayor Ana Botella, a staunch Eurovegas supporter, recently told reporters: "This issue doesn't affect us because really we don't know anything about these investigations."

"We don't assess private companies abroad," a spokesman for the Treasury of the Community of Madrid, the region that includes the capital, told Reuters.

The government of Catalonia, the coastal region that is home to Spain's second city, declined to comment on the probes. A spokeswoman said the project continued on track in the run-up to the firm's decision, due in September.

Madrid and Barcelona have been on months-long charm offensives since Las Vegas Sands Chairman Sheldon Adelson proposed building the 12-hotel, 6-casino complex in one of the cities, investing $18.5 billion. He visited potential sites early in 2012.

Adelson, whose company draws most of its revenue from Macau, the gambling capital of the world and the only area of China where casinos are legal, has become an increasingly prominent political figure in the U.S. over the past year as a large financial supporter of Republican presidential candidates.

HARD TO RESIST

For Spain's politicians, poor economic health makes Adelson's proposal difficult to resist.

The country has already accepted a €100 billion bailout for its stricken financial sector and PM Mariano Rajoy has indicated Spain could ask for more EU aid as borrowing costs stay punishingly high and the economy shrinks.

Tourism is a sector Spain already excels in - it accounts for around 10% of the country's economic output and is one of the only drivers of growth.

Eurovegas would tap into that, and Las Vegas Sands claims the project would eventually create a quarter of a million jobs in Spain. But community and environmental groups are opposed. Activists have cited fears it would encourage corruption and illegal activities, and questioned how beneficial it would really be in swelling state coffers and providing jobs.

Last week a small leftist party in Catalonia, ICV-EUiA, called for Adelson to appear before the Catalonian legislature to answer questions about the investigations. But without support from other parties, which has not emerged, the petition is unlikely to go anywhere. The government in Madrid has considered special tax laws and relaxing an indoor smoking ban to lure Adelson's investment, according to local media reports.