Jeju Island is pushing to establish a strict Singapore-style casino watchdog and revise taxation on casinos to improve transparency of the gambling industry and boost the local economy, its governor said. 

Jeju Gov. Won Hee-ryong made the remarks during a parliamentary audit on Thursday as the southern resort island has seen a rapid surge of real estate investment and travelers from China over the past years on the back of accommodative visa programs.

The provincial government has been preparing to launch a casino regulator modeled after Singapore's Casino Regulatory Authority to oversee operations and licenses for new businesses as a growing number of real estate developers test opportunities for gambling resorts to draw Chinese tourists. 

"We have to first establish an effective regulation and taxation system before starting discussions on whether to open or repeal new casinos," Won said during the audit by the Land Infrastructure and Transport Committee. 

Singapore lifted its long-standing ban on gambling in 2005 and established a strict casino regulatory regime that entails tough inspections and thorough review of license applications. 

Since taking office in July, the former ruling Saenuri Party lawmaker has repeatedly vowed to tighten regulations on speculative money and took issues with construction licenses issued by his predecessor. 

South Korea bans locals from gambling except at state-run Kangwon Land in the country's eastern mining town, with eight out of 16 foreigner-only casinos located in Jeju Island. 

In response to growing concerns over reckless development, lawmakers urged the self-governing provincial government to revise qualifications for casino operations and take measures to prevent illegal money transfers from casinos. 

"The casino industry needs restructuring to attract sound investment and ensure transparent operations to tackle illegal foreign capital outflow," Rep. Lee Un-ju of the New Politics Alliance for Democracy (NPAD) said. "The casino supervisory body proposed by Jeju governor will have to go through consultations with the central government."

Lawmakers also expressed concerns over the growing land ownership by the Chinese, saying it is time to revise the real estate investment visa system introduced in 2011. It grants permanent residency to real estate investors who purchase property worth US$50,000 or more.

"As Chinese investment has sharply grown since 2010, 5.9 million square meters of land, or 43 percent of total land owned by foreigners, is owned by the Chinese, " Rep. Min Hong-chul of the NPAD said. "The investment visa program needs to be improved."

Many of the ongoing large-scale development projects in Jeju are being pushed by Chinese companies or joint consortium involving Chinese, accounting for about 40 percent of those under way, the lawmaker said. 

"Development projects and the local economy are heavily dependent on Chinese funds," NPAD lawmaker Lee Mi-kyung said. "The real estate investment visa program may be helpful in bringing foreign capital at the early stage. But now, it is creating bigger social problems, such as causing reckless development and hurting the identity of the local community." 

Won replied he will consider raising the floor price of the property needed to qualify for a permanent resident visa and more stringent review of land development projects. 

"We are preparing measures to restrict investment to only accommodation facilities and casinos," Won said. "The government is pushing to grant residential rights for those who make investment in investment promotion area." (Yonhap)