Trade, tourism and gambling
The Himalayan Times , 22 nov 2004
After a gap of a few years I again visited Las Vegas in the US to attend a gambling conference and exhibition. Hotel rooms continue to be added at a break-neck pace to the already existing stock of over 1,25,000 rooms in the city. The latest two billion-dollar casino cum hotel almost ready is the 'Wynn'.
Even more than being a gambler's Mecca, Las Vegas has become a destination of choice for the world's biggest conferences. And why not? Las Vegas has the accommodation - dozens of hotels with 5,000 rooms each - mega shopping malls, entertainment, and the world's biggest conference infrastructure.
How did this happen? What made Las Vegas in the middle of the desert state of Nevada, the fastest growing city in whole of the US? Las Vegas shows the power of enlightened laws. It shows what can be achieved by lawmakers when they act in accordance with our basic instincts to be free to do what we want to with our money including gambling it away.
Las Vegas is in a perpetual boom because it has legitimate gambling, is liberal in issuing casino licenses, and has no state income tax. Realizing that gambling cannot be eliminated by merely declaring it illegal, the lawmakers of Nevada did away with hypocrisy which characterizes politicians, faced upto the truth, and said, 'lets make Nevada the world's gambling capital'. I cannot think of any other advantageous factor that sets Nevada apart from other states in the US.
In fact, whatever other facts come to mind about Las Vegas and Nevada are negative. Nevada is landlocked having no access to the seas like California has. And yet it is Las Vegas which is thriving while California has been in an economic decline for more than a decade. People of California finally rebelled against their governor, threw him out of office, and brought in Arnold Schwarzenegger who promptly reduced taxes on cars by 66% - one of his most popular actions so far.
Nevada has an arid landscape and an inhospitable climate. California's coastline makes its cities like San Francisco have perhaps the best weather in the whole of US - whatever may be the time of the year, it is neither too hot nor too cold. However, all this is scant comfort to businessmen who prefer lower taxes in Nevada. Many move out of California and migrate to Nevada to take advantage of its liberal business environment.
This shows yet again the importance which businessmen attach to low taxes and low regulation. A desert blossoms while an oasis shrivels - all depending on what the policies instituted by the state are.
At the conference, I noticed that there were exhibitors showing their wares from all over the world. There were roulette wheels from England, horse-racing simulators from South Korea, computerized gaming devices from Slovakia, and slot machines from Australia. There was hardly a continent which was not represented.
What amazed me was the number of products they had moved from their countries to the Las Vegas exhibition center; the exhibition covered over 200,000 sq. fts. I asked some of the exhibitors whether they faced any regulatory problems in bringing their goods for showcasing in the US? They said, 'No'.
Contrast this with what would happen in Nepal; a company from Bangladesh wanting to bring its goods to exhibit in Kathmandu, would have to obtain multiple government approvals. Customs here would presume that the foreign exhibitor is going to sell his goods in Nepal, and would, therefore require it to make a deposit equivalent to the duty payable on importing that particular good. In the US, no such deposits have to be made. The conference organizers have special approvals which make showcased products duty exempt.
It is enlightened practices like this which result in a massive influx of conference tourists to the US. Everything is linked. Lower regulation helps tourism which in turn gives a boost to trade as well.
Nepal can do better than the US, why not convert this nation into a duty free one? Watch it boom as people come for shopping, gambling, and yes for conferences too.