The development comes as travel restrictions introduced during the coronavirus pandemic are removed, leading some local governments to reassess the idea of attracting tourists to a so-called integrated resort, or IR, comprised of a large hotel, conference rooms and gambling areas.

The central government will hold a task force meeting as early as Friday, where Prime Minister Fumio Kishida and relevant ministers are expected to approve the Osaka IR plan, the sources said.

The Osaka prefectural and city governments aim to open the facility between the fall and winter of 2029 on the artificial island of Yumeshima in Osaka Bay.

The resort, involving a partnership between MGM Resorts International of the United States and Japan's Orix, is expected to attract around 20 million visitors annually and bring ¥1.14 trillion ($8.5 billion) in annual economic benefits to the western Japan region centering on the prefecture.

According to the sources, Nagasaki Prefecture has also submitted a plan to host an IR, but the task force is likely to postpone any decision on the basis that it requires more time to further assess the details.

In 2018, a law was enacted that allowed for the development of up to three IRs. But plans to stimulate the economy through casinos faced public opposition largely due to concerns about the negative impacts of gambling.

Momentum was also slowed by procedural delays amid the pandemic, withdrawals of foreign operators and a graft scandal that led to the arrest in 2019 of a lawmaker who campaigned for casino legalization.

The approval of the Osaka plan, which had been expected last year, was delayed also due to concerns over liquefaction risk and soil contamination on Yumeshima. The plan is expected to get conditional approval, according to people familiar with the matter.

By Kyodo, Jiji