Malaysia said today it would not allow any more casinos to be built in the mainly Muslim country after a proposal for one on the resort island of Penang.

"We have a policy that we will not have a new casino in the country or issue a licence," Deputy Prime Minister Najib Razak was quoted as saying by Bernama .

The idea of setting up a second casino in Malaysia was first mooted last October by Lim Chong Eu, former Penang chief minister, who said it could help revive the island's tourism industry.

Gambling is strictly prohibited in Islam. Some 60 percent of Malaysians are Muslim Malays, living alongside ethnic Chinese and Indian communities.

Genting only casino

Genting, Malaysia's sole casino operator, is controlled by the family of tycoon Lim Goh Tong. It also runs a gamut of businesses ranging from power to properties in Malaysia.

Its crown jewel is a hilltop casino resort in Pahang, which attracts more than 15 million visitors each year.

It recently entered a bid for the first casino in neighbouring Singapore. It is competing against Las Vegas Sands; US gaming giant MGM Mirage and its partner, Southeast Asia's biggest property group CapitaLand; and Harrah's Entertainment, the world's biggest gaming operator, and its local partner Keppel Land.