The 2014 Sochi Olympics can have an unexpected effect on the Russian gambling industry, resulting in more freedom for the operators.
Even prior to the 2014 Olympic Games there were rumors and speculations that Sochi can become a Russian Las Vegas right after the games. The current Russian gambling laws prohibit most forms of gambling with the exception of four quite remote regions, which have been designated as gambling zones.
Altai Krai, Kaliningrad Oblast, Krasnodar Krai, and Primorsky Krai are the current gambling zones in Russia, however, there’s little development being done there in terms of casinos or online gambling sites in Russia. Due to the fact that Sochi and its region have received an enormous amount of funding for the Games, it’s been widely rumored that the government might decide to turn it into a gambling paradise after the Olympics with a view to generate more money and win back some of the costs it took to prepare for the Games.
Olympic Games generated huge profits from gambling taxes
While casinos and gambling halls are now outlawed in Russia, sports betting companies are allowed to operate and accept bets from the population. Naturally, the Olympic Games have created a wide range of opportunities for punters to wager on their favorite sporting events, athletes, and teams.
Bets were being made at brick-and-mortar betting shops, as well as online sportsbooks in Russia, whose status is a bit of a question mark right now. The sheer amount of bets made generated huge taxes paid by betting operators into the government coffers.
After realizing the potential, some of the Russian lawmakers started to rethink their policies towards gambling. It’s now rumored that they might even be a new law amendment under discussion, allowing some of the other gambling forms to return to the Russian market in one way or another.
This is another positive outcome of Russia’s big gamble on the Olympics, and a quite unexpected one. It remains to be seen, however, just how serious the lawmakers’ intents are towards changing the gambling regulations and allowing more freedom for the industry.
President Putin’s reaction to rumors about Sochi transforming into a gambling center
Upon hearing the rumors about Sochi being turned into a gambling resort after the Olympics, President Putin told the Russian gambling news that he was against it. The main reason for his stance is the fact that should Sochi become Russian Las Vegas it will certainly lose most of its traditional visitors – the middle-class families coming there for holidays.
The proposals to turn Sochi into a gambling resort came from as high as Prime Minister Dmitry Medvedev. He opined that transforming the region into a safe-haven for gamblers will offset huge losses expected on behalf of businesses heavily invested in the development of Sochi.
Putin had the following comments about Sochi’s future as a gambling zone: “We already have a gambling zone on the border between the Rostov Region and the Krasnodar Territory, and we even allowed them to access the Black Sea coast. In my opinion, it would be impractical to set up another zone in the region, although it would certainly make things better for investors.”
The President continued saying that Sochi becoming a gambling Mecca “would create an atmosphere that would prevent our citizens from spending their holiday here with their families.” However, he did leave a glimpse of hope, speaking about the financial benefits of such a transformation.
Sochi’s future after the Olympic Games
With the possibility of transforming the region into another gambling zone not off the cards completely, there are other prospects of Sochi’s development after the Games. The 2014 Olympics are the most expensive in history of the Games. The over $50 billion price tag is actually higher than all the previous Winter Olympics combined.
According to Putin, his gamble on Sochi Olympics in terms of money spent, is primarily focusing on making the Black Sea resort even more attractive to middle-class tourists. The infrastructure developed for the Games will last for decades to come and will certainly be taken advantage to the fullest by generations of tourists to come.
The President commented: “We should put into operation everything that had been created and ensure that it works efficiently.” He was referring not only to the housing, sporting facilities and infrastructure to remain in Sochi. It is not a secret that some of the buildings and facilities have been designed in a way allowing them to be dismantled and transported to a different location. This method will allow to save considerable amount of money for the next big event to be hosted in the country.
Speaking about the possibility to invest additional funds in the region to elevate its touristy attraction, Putin said that Sochi is going to have to come up with their own funds. Here are his words: “For all the love for Sochi, it now must be developed through very different means. Additional investment can’t really be expected after the enormous resources invested here.”
Russian gambling industry’s prospects after Sochi
The boosted sports betting during the Olympic Games has certainly showed skeptics just how important land-based and online sportsbooks in Russia are for the state coffers. Naturally, the state income generated by gambling taxes will diminish somewhat after the Games. However, the gambling industry now has an excellent proof how they can generate profits themselves and feed the government at the same time.
Sochi affects Russian gambling industry
• Russian gambling laws might be altered to allow more freedoms after the Games
• Huge amount of gambling taxes has been generated during the Games
• Sochi’s prospects as a gambling center are still under considerable doubt
Another very important aspect of gambling on the Olympic Games is the fact that a large portion of taxes on sports betting during Sochi has left the country and went overseas. Simply because many Russians and foreign punters have opted to place their Olympic wagers at online bookies hosted off-shore.
This was mainly caused by absence of clear regulations of the online betting business in Russia resulting in a very limited selection of Russian-based internet betting sites. Hopefully, the interested parties – the lawmakers and the industry bosses can now see the whole picture and understand just how important it is to have a regulated, but still legal betting market inside the country.
Russia is an enormous country in every term, and preventing their population from betting legally within the country is simple a waste of opportunity. Let’s hope the Russian lawmakers realize the fact that it’s better to profit from legal and regulated gambling industry than to ban it altogether and get nothing, but problems with underground gambling.
Check out the whole series of feature articles dealing with Russia’s big gamble on the 2014 Sochi Olympic Games.