Philippines iGaming Industry Shrinks As 175 POGO Permits Get Cancelled
- The iGaming industry in the Philippines has shrunk significantly
- Gaming regulator cancels 175 permits for POGOs
- POGO exodus from the Philippines could result in $3.23 billion loss
The Philippines had a thriving online gambling industry before the COVID-19 pandemic hit and caused massive disruptions and was hoping to recover by 2026. The Philippines encouraged Philippine Offshore Gaming Operators (POGOs) to set up operations in the country and issued hundreds of licenses prior to the pandemic.
The vast majority of these POGO operators had ties to Mainland China and would set up offices in the Philippines staff them with Chinese speaking employees and cater to online gamblers in Mainland China.
When the Philippines found POGOs thriving, the government decided to impose a higher tax ceiling on POGOs and this did not go down well with them. China sent out a strong message to offshore gaming operators who targeted Chinese nationals since gambling in all forms are forbidden in Mainland China.
Gambling Regulator Cancels 175 Permits
The unrest in the POGO industry and the added pressure that China imposed resulted in the Philippine Amusement and Gaming Corporation (PAGCOR) taking action against POGOS. The gambling regulator is reported to have cancelled as many as 175 POGO permits till mid-September due to a variety of reasons which includes POGOs not paying their taxes correctly and not adhering to gaming regulations.
Authorities in the Philippines are also in the process of repatriating around 300 Chinese nationals who have overstayed their visa. Before the end of October, close to 4,000 Chinese nationals are expected to be repatriated to China as the closure of POGOs have left their Chinese employees without work in the Philippines.
There are now less than 30 official POGO operators in the country and a few more could end up losing their POGO permits by the end of the year.
POGO Exodus Could Result In $3.23 Billion In Losses
The mass exodus of POGO operators is going to hurt the Philippines in more ways than one. A lot of POGO operators had rented out prime real estate properties for their operations and customer support teams. With the closure of POGO offices, the commercial real estate market in the Philippines is also going to take a hit.
The exit of POGOs is expected to hurt the economy in the Philippines as losses of $3.23 billion per annum are expected as revenues will dip in multiple sectors including taxes, commercial real estate, residential real estate from POGO employees, utility bills and more.