GLOBAL ECONOMY

Hilton closes Puerto Rico's biggest casino because of economic crisis

  • SAN JUAN, PUERTO RICO - JULY 01:  A couple walks on the beach on July 1, 2015 in San Juan, Puerto Rico. The island's residents are dealing with increasing economic hardships and a financial crisis that has resulted in the government's $72 billion debt.  Governor Alejandro Garcia Padilla said in a speech recently  that the people will have to sacrifice and share in the responsibilities for pulling the island out of debt. Consumer tax on certain items has risen to 11.5 percent. (Photo by Joe Raedle/Getty Images)

    SAN JUAN, PUERTO RICO - JULY 01: A couple walks on the beach on July 1, 2015 in San Juan, Puerto Rico. The island's residents are dealing with increasing economic hardships and a financial crisis that has resulted in the government's $72 billion debt. Governor Alejandro Garcia Padilla said in a speech recently that the people will have to sacrifice and share in the responsibilities for pulling the island out of debt. Consumer tax on certain items has risen to 11.5 percent. (Photo by Joe Raedle/Getty Images)  (2015 Getty Images)

  • SAN JUAN, PUERTO RICO - JULY 01:  A family relaxes on the beach near the shell of a building on July 1, 2015 in San Juan, Puerto Rico. The island's residents are dealing with increasing economic hardships and a financial crisis that has resulted in the government's $72 billion debt.  Governor Alejandro  Garcia Padilla said in a speech recently  that the people will have to sacrifice and share in the responsibilities for pulling the island out of debt.  (Photo by Joe Raedle/Getty Images)

    SAN JUAN, PUERTO RICO - JULY 01: A family relaxes on the beach near the shell of a building on July 1, 2015 in San Juan, Puerto Rico. The island's residents are dealing with increasing economic hardships and a financial crisis that has resulted in the government's $72 billion debt. Governor Alejandro Garcia Padilla said in a speech recently that the people will have to sacrifice and share in the responsibilities for pulling the island out of debt. (Photo by Joe Raedle/Getty Images)  (2015 Getty Images)

One of Puerto Rico's biggest and best known casinos closed Wednesday after 40 years of operation in another blow to the U.S. territory's struggling economy.

The Condado Plaza Hilton laid off 144 workers from the seaside casino located in the popular tourist district of Condado, managing director Raul Bustamente told The Associated Press. He said the closure follows a 40 percent drop in the use of slot machines over the past decade.

The former 24-hour casino, which opened in 1975, will likely be turned into a ballroom, he said in a phone interview.

"We now want to focus on areas where we've had good business: rooms and banquets," Bustamante said.

Puerto Rico's Hotel & Tourism Association said it is the seventh casino to close in the past five years on the island of 3.5 million people, which is entering its ninth year of recession and is struggling with a 12.6 percent unemployment rate.

Gambling taxes represent the majority of revenue for Puerto Rico's Tourism Company, which is responsible for promoting the island. A portion of that revenue also goes to the University of Puerto Rico, the island's largest public university.

"This is a significant impact," tourism association President Miguel Vega said in a statement.

Jason Rivera, president of a local gastronomy union, rejected the newest round of layoffs and said workers were unfairly paying for an economic crisis caused by the government.

"We are not going to remain with our arms crossed in the face of so much injustice," he said.

Government officials have said previous casino closures caused a $6 million drop in revenue.

Critics in part blame the closures on an estimated 45,000 illegal gambling machines that operate across the island, with the government seizing hundreds of machines in occasional raids. About 90 percent of casino clients in Puerto Rico are locals, not tourists, according to the Hotel & Tourism Association. There are currently 20 casinos now operating on the island.

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