Taipei  - Taiwan's Penghu Islands held a referendum Saturday to decide if casinos should be allowed to be built on the archipelago.

Polling stations opened at 8 am (0000 GMT) and will close at 4 pm (0800 GMT). Results are expected at 6 pm (1000 GMT).

A total of 73,651 eligible voters were expected to cast ballots at 112 polling stations on Penghu, a group of 90 islets about 40 kilometres off Taiwan's western coast.

Penghu County Magistrate Wang Chien-fa said the islanders take the referendum seriously because it is the first such referendum held in Taiwan and its outcome will affect the islands' future.

"Whatever the outcome, we will respect it because that is the will of the people," he told reporters before casting his ballot.

If more than 50 per cent of the voters back building casinos, the Penghu Tourism Bureau will start to promote leisure villages which would include gambling houses.

Penghu residents are divided on the question of building casinos. Some want legalized gambling to turn it into the "Las Vegas of the Orient." But others warn that gambling will only bring crime, but not much cash, to Penghu.

The islands' economy relies on fishery and tourism, but there are no tourists in winter because winds are strong and it is too cold.

Taiwan bans gambling, but on January 12, the Parliament passed a controversial bill to legalize gambling on offshore islets, where approved by a majority of local residents. (dpa)