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Since 1947 the Mexican Government Has Prohibited Casinos,
 Texas-Mexico Border Towns Hope that Changes
By Victoria Hirschberg, The Monitor, McAllen, Texas
Knight Ridder/Tribune Business News

June 28, 2004 - REYNOSA, Mexico -- "Buenas" and "Ya gané" may be common winning phrases in Mexico, but there is one that is never heard.

"Jackpot." Since 1947, the Mexican government has prohibited casinos and gambling.

However, with a recent push from several Congress members and representatives from the Reynosa Chamber of Commerce, that might soon change. There is an initiative now under review in the Mexican Congress that would revise La Ley Federal de Juegos y Sorteos, the anti-gambling law. Congress will vote in September.

"Right now for the first time we have that initiative," said Patricio Mora, a member of CANACO, the Reynosa chamber of commerce. He also is president of Centros Turisticos Internacionles y de Entrenimiento de Mexico S.A. de C.V. (International Tourism Centers and Entertainment of Mexico). "It's important because we are talking about 2,000 direct jobs and indirectly 7,500." "It's one of the most debated issues in tourism, commerce and economy," said Lic. Camilo Martinez Cortez, CANACO president in Reynosa.

He said legalizing gambling and casino investment would give Mexico a new competitive edge. Because gambling and casinos are illegal in Texas, there is a potential market for Rio Grande Valley residents to take day or weekend trips to nearby Mexican cities.

"We are thinking we can do hotels, restaurants, areas of business," said Onésimo Esquivel Loredo, CANACO president in Matamoros.

A study conducted in 2002 by a congressional subcommittee, La Camara de Diputados, indicates positive and negative effects of casinos in Mexico.

According to the study, the government and the private sector would develop casinos in specific zones to attract tourists. These zones stretch across the Texas-Mexico border and into other cities like Veracruz, Cuernavaca, Cancún, Acapulco and Mexico City.

The study indicates that the private sector would at least develop 10 mega-casinos, comparable to those in Las Vegas, and initially invest more than $2 billion for the project. Those mega complexes would have hotel capacity for 125,000 guests in addition to the casino -- similar to the population of some small Mexican cities.

The analysis concludes that positive impacts would include a needed economic push through tourism, creation of infrastructure, increased tax base and new jobs.

The analysis also points out the negatives, such as a possible crime increase, money laundering, organized theft and social problems such as prostitution. Also, gambling might lead to personal debt and addiction.

Despite the potential negatives, Mora believes casinos will be a necessary economic boost for Mexico.

"They can invest in the local infrastructure with the services like electricity, something that the people need," Mora said. "The streets we have are a big problem in Reynosa." Some of those big problems are what Lic. Samuel Ramirez Valdez is concerned about. As the sub-director for tourism in Reynosa, he is uncertain if Reynosa could handle an additional 2,000-plus people due to a casino.

"It's a delicate matter," he said. "Some say of course it would bring more people and more tourism to Reynosa, but there are some issues that you have to consider before doing that." He said casino security, poor roads and limited infrastructure are issues that must be considered before building multi-million dollar casino complexes with surrounding hotels and restaurants. Existing resort areas like Cancun, Acapulco and Puerto Vallerta might handle large casinos better than border cities like Reynosa and Matamoros because there is support for large crowds, he said.

"I think it's a good thing for Reynosa, but you have to plan it really well because it could get out of hand real fast," Ramirez said. "I don't know if it's the only choice to economic development. I would be happy for a waterpark established in Reynosa." In 2002, federal police shut down the D'Stressa casino in Reynosa, according to The Monitor archives. The International Thunderbird Gaming Corporation operated casinos in Reynosa, Nuevo Laredo and Matamoros.

Federal police also shut down those locations.

Even if the Mexican Congress approves casinos, actual development still is about two years away, Mora said. He said he would seek investment from United States and Mexico-based companies.

"This is for people who want to stay with us one, two days, a weekend, and go to casinos," Mora said. "Maybe like Las Vegas." While Reynosa's Calle Morelos probably won't be the next "strip" anytime soon, an increase in people traveling to Mexico is possible, said Tina Martin, owner of Scottie's Tours 'n' Travel in McAllen.

"There is a tremendous push for places for groups to gamble," Martin said.

"The No. 1 for most of Texas is Las Vegas." Mexican destinations like Cozumel and Cancun are the second-most popular vacation for Texans, while Disney World is the third, she said.

In order for Mexican casinos to compete with Vegas, Martin said infrastructure such as shows, celebrities, restaurants and activities also must develop.

"One of the things that has been a real plus for Las Vegas is that they have extremely inexpensive hotels and extremely expensive hotels," Martin said. "That is one thing Mexico is going to have to be open to. You have to have something for the budget-minded traveler." Many Valley residents take advantage of quick weekend getaways from San Antonio to Vegas or head east to Louisiana where gambling also is legal.

Mexico is a definite market for gambling and casinos, Martin said.

"Gambling is going to be a real plus," she said. "People will go crazy."

-----To see more of The Monitor, or to subscribe to the newspaper, go to http://www.themonitor.com.

(c) 2004, The Monitor, McAllen, Texas. Distributed by Knight Ridder/Tribune Business News. For information on republishing this content, contact us at (800) 661-2511 (U.S.), (213) 237-4914 (worldwide), fax (213) 237-6515, or e-mail reprints@krtinfo.com.

 
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