The Middle East war is having a tangible impact on the Philippines gaming sector, says the chairman of the Philippine Amusement and Gaming Corp (PAGCOR).
“This is not a good time for everyone,” said Alejandro Tengco in a Wednesday news release. “Gaming jurisdictions globally are feeling the impact of the oil crisis. And even more progressive countries like Singapore, Macau and the United States are not spared.
“At PAGCOR, we will adjust,” the statement continued. “We have to be in tune with the times and ensure that responsible gaming remains at the centre of what we do.”
In response to the crisis, last month Philippine President Ferdinand Marcos Jr declared a state of energy emergency. A 24 March memorandum from Malacañang noted “uncertainty in global energy markets, severe disruptions in supply chains and significant volatility and upward pressure on international oil prices” as threats to the country’s energy security. The declaration could remain in effect for a year or longer.
Brief respite for online gaming operators
On 30 March, in a lifeline for Philippine online gaming operators, PAGCOR deferred newly mandated minimum guaranteed fees (MGFs) from 1 April to 1 June. The new fee structure requires all licensed Philippines gaming system administrators (GSAs) offering e-games to pay MGFs of PHP9 million (US$149,400), based on assumed gross gaming revenue of PHP30 million.
The monthly rate for GSAs that do not offer e-games was PHP4 million, based on GGR of PHP15 million. Starting in October, the rates were due to increase to PHP10.5 million and PHP4 million, respectively. That timeline has also been modified, with the second tranche starting in December.
In related news, Tengco said he is still waiting for the Philippines Governance Commission to approve the sale and privatisation of commercial casinos now operated by PAGCOR. In 2022, when Tengco was first appointed, he agreed PAGCOR must end its dual role of regulator and operator, which many lawmakers have called a clear conflict of interest. At last year’s Asian Gaming Summit, he reiterated that “in layman’s terms, a referee cannot be a player on the same field”.
But PAGCOR continues to run more than 40 casinos under the Casino Filipino brand. “Many are asking for the decoupling, and we are awaiting the decision,” Tengco said Wednesday. “If we get the approval to privatise, it will be a game-changer.”
War an ‘economic fault line’ for Philippines
Meanwhile, Alicor Panao of the University of the Philippines has called the Middle East war a “direct economic fault line” for Filipinos. In comments to the Philippine Inquirer, Panao called the conflict “a high-stakes economic event … where foreign policy shocks translate into household vulnerability and macroeconomic uncertainty.”
Gaming-related industries like tourism are also under the gun. According to the Manila Bulletin, Alfred Lay of Leechiu Property Consultants has compared the current crisis to Covid-19 in its implications for travel.
“Philippine hotels are entering their most challenging period since the pandemic,” Lay said. “Occupancy is expected to fall sharply in April and May as the fuel crisis drives up airfares, dampens traveler confidence and squeezes household budgets”.
He added, “With international arrivals under threat and domestic spending softening, the industry is bracing for a difficult second half of the year. And the outlook beyond that depends entirely on how quickly the Hormuz crisis resolves.”
Marjorie Preston
Marjorie began her gaming career in 2007 and has focused on Asian gaming markets since 2020. Outside of work, she writes about travel and film and plays the drums.
Original article: https://igamingbusiness.com/casino/tourism/pagcor-chief-philippine-gaming-sector-feels-repercussions-of-iran-war/
