The Eastern Cape Gambling and Betting Board has received two applications for the Mthatha licence and three for the smaller Queenstown licence. The deadline for applications has now passed and details of the bids will become available in two weeks. The two new licences will bring the number of Eastern Cape casinos to five. The three operational casinos, Wild Coast Sun, Hemingways and Boardwalk, generated R46 million (US$6.7 million) in gambling taxes in the 04/05 financial year.

Two earlier applications for the Queenstown licence were withdrawn over financing problems. Some restrictions on the licences are onerous and include a ten-year limit, felt by some to be insufficient time to recoup development costs and get into profit. The regulatory Gambling and Betting Board ensures that licencees maintain a maximum 8% profit margin. It is estimated that most new casino complexes take eight years before financing debt is repaid.

The licence for Mthatha requires a minimum investment of R65 million (US$9.5 million) and a 40-room hotel. In Queenstown the requirement is for a 30-room hotel and minimum investment of R50 million (US$7.3 million). Both locations must also provide child care and play areas, conference facilities and restaurants. The two new licences will probably be issued next February. (E-06.14.06)

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