China Considers Legal Gambling on Hainan Island

China is drafting a proposal to allow gambling on Hainan Island, people familiar with the talks said, in what would be an unprecedented move that could reshape gaming in China’s territories and transform the economy of a strategic southern province.

Government agencies under a party reform group headed by President Xi Jinping are considering allowing online gaming, a lottery or sports betting in Hainan, said the people, who asked not to be identified because the discussions aren’t public. The proposal, which is still in an early stage, could open the door to physical casinos over the long term, two of the people said. China currently bans gambling and casinos on the mainland.