Ep 306: Philippines continue 2024 illegal gambling crackdown

Andrew McCarron (00:00.142)
Very few would have put the Philippines on their 2024 bingo card to make big waves in 2024. However, the year has witnessed continuing developments in the Philippines as the Philippine Amusement and Gaming Corporation has made a valiant effort in cracking down on illegal gambling activity since the turn of the year. This includes locking horns with other countries such as China and South Korea in a battle against cross -border gambling. And this will be the focus on today's episode of iGaming Daily, supported by OptiMove.

where we will look into the intricate relationship between the Philippines, China and offshore gambling industry. And joining me to dive deeper into these developments, examining the implications for both the Philippines and China and what it means for the future of offshore gambling is Casino Beast editor Joe Streeter and senior journalist Connor Porter. How are you both doing today? okay? Doing good, James. Doing good, yeah. Ready to chat about the Philippine gambling market and how it's developing over the past.

few months since the turn of the year. Yeah, I'm quite interested in this topic to be honest, because it's a lot different to what we've been covering recently on iGameIndaily. It's a shift away from UK politics and football that's going across the globe. Was there football going on? I didn't know. Seems to have been some football going on somewhere. Cup of America, is that it? Yeah, yeah, definitely. I that. I don't think England would do anything special. And we don't talk about Spain. Joe, you okay? You seem a bit

I'm all good. Well, no, no glumness, man. Actually let the, uh, let the listeners into a little secret that you treated the office to some, uh, some Greg's donuts today. So I'm feeling very good, very sprightly, very energized. You can thank the Spanish for that because I won £60 on the office sweepstakes at Spain. a traitor. Yeah. Well we are now cause you brought Greg's up. So it makes me look good. Yeah. So thank you for that. I'm full of, full of sugar. I'm raring to go talk about the Philippines.

Yeah, just don't have a sugar crash like halfway through. We've got a few minutes left of me and then I'm going to need a nap. Okay. So I like to do kind of some fun, interesting things about the topic that we talk about on the podcast. This one is a bit difficult because my kind of knowledge of the Philippines is limited to Manipakiao and that's about it. So, but I have one interesting fact and I'm going to ask you two for an interesting fact. Joe's his head now, but I one.

Andrew McCarron (02:25.838)
Um, we're all kind of video gamers, aren't we? Um, and I didn't realize this until I Googled it, but in 1981, uh, the Philippines put a ban on video games for five years due to parents believe in space invaders and asteroids were detrimental to youth morale. So they had two weeks to destroy all their video games. And that lasted for five years until the 1986 people power revolution.

A revolution we can all get behind, James. Right? If Sir Keir Starmer told me I two weeks to get rid of my video games, I would have a people power revolution. It would be up for all. Well, I was shaking my head because I thought you were going to steal my Pac -Man, Pac -Man fact, my Manny Pacquiao fact, and that is that he's the only boxer to win major world titles in four separate decades.

Which is astonishing really when you think about it from the 1990s through to the 2020s, four separate decades. If you think about that in any other sporting term, it's quite crazy. think eight weights, but four decades, just the longevity of the man is phenomenal. And obviously political powerhouse in the Philippines as well. Yeah. Really one of my sporting heroes. yeah.

fighting in some capacity right now, isn't it? No, not anymore. may have done exhibitions or something like that, but his career went on for a long time, nothing serious anymore. yeah, probably, he lost, God, maybe like five or six years ago and called it a day then after a last run. But he quit at the very top of the game as well. He never, he never really declined. He stayed at the very highest level. That's right. Well, that's right then, that one.

Yeah, I thought you were going to steal it from me for a minute when you mentioned Manny Pacquiao and my heart was racing. I thought you might have a snort mind when you said Pac -Man. I just wanted to keep you on your toes. Connor, anything? We've set a high bar here, to be honest. Yeah, that's what I mean. You pretty much covered the only thing I know about the Philippines, which is about Manny Pacquiao and his fantastic boxing record and obviously gone on to become a politician of the country.

Andrew McCarron (04:40.952)
Yeah, is as far as my Philippine knowledge goes, apart from these numbers that we've got coming up here. So might be my interesting fact, you know? What a nice little segue, because I was going to say, you know something other than moneypacking. But actually, the number one interesting fact today is that Optimove is the number one CRM marketing solution for the iGaming market and the supporter of the iGaming Daily podcast.

listeners out there, can still claim a free month of OptiMove by visiting www .optimove .com forward slash SBC. All links will be left in the description below. So go on. First off, we're to talk about the, the Philippine amusement and gaming corporation with their latest financial results. Uh, believe it was the first half of 2024 results, Connor, you've been delving into them. What were the headline figures? So the headline figures for them was an over 120 % increase in

income in comparison to the first half of 2023, so year over year, an over 19 % uptick in gross gaming revenue as well. And the CEO and chair of Padcore, Alejandro Tango, said that this would be a banner year for the market considering how well they've done so far in the year. So net income,

Currently stands, this is in pesos, Philippine pesos, stands at 6 .56 for net income, which is roughly about 102 .8 million euros. And as previously mentioned, over 120 % increase on the year. Gross gaming revenue standing currently at 194 .74 billion pesos, 19 .21%.

And Tango puts this down to the reforms and enhanced regulations that they've been implemented under the new administration contributing towards the growth. yeah, good growth for them in the first half of the year. And interestingly enough, this is pushing close towards some of the forecasts that they had earlier on in the year, back in March. Part of their hoping of more

Andrew McCarron (07:02.446)
attracting investments into the gaming market was to be decreasing the GGR re -admittance rate for online and on -site betting platforms from April this year. With that in mind, back in March they forecasted the 2024 GGR to be around $336 billion pesos. The fact that they're already up towards

billion pesos is good going from so far. It looks like they're going to breeze past that benchmark quite easily come the end of the year. You've covered every single question that I have on this actual part of the conversation, but I think it's really important to highlight Padcore's financial results because they have been very active in the first half of this year, like I mentioned in the introduction. These financial results come in the same month that Padcore emphasised its commitments to eradicate the illegal gambling market.

and have all of the country's gambling sector by potentially banning Philippine offshore gaming operator hubs. So first off, Joe, what are Philippine offshore gaming operators hubs? So they were brought in in 2019 and without knowing the economy too much, it's hard for me to give a full definition, but in self -contained gaming hubs, they try to sort of home operations of Philippine offshore gaming operators, which as the name suggests.

And there's a real, well, when they were brought in anyway, there was a real emphasis on kind of halting and lessening as much as possible interaction between Chinese workers and local Filipinos. yeah, the gaming hubs essentially, and quite innovative when they were brought in a new idea, but it hasn't quite panned out the way in which I think the country would have liked. So, Padcore, they've kind of underlined

its overall ambition to strengthen safeguards against offshore gambling taking place in the region. Conor, come to you on this one. What measures are Filipino authorities planning to take to eradicate the illegal gambling market? Well, it's just mainly part of a pad cause push forward to basically become solely a gambling regulatory agency rather than what it's currently doing at the moment, which is a duality role of being an operator and also being a regulator.

Andrew McCarron (09:24.11)
by 2025, so come the turn of the year, they're hoping to be in that role and to begin the privatisation of Casino Filipino or their land -based operations throughout early 2025 and into early 2026. So it's part of that essentially to make the gambling environment more safer, more regulated across the country so that players are safer and better protected when...

They do go to play online. Joe, you also did the story on what they're planning on approaching with the regulatory changes in the forthcoming year. There's more to it than just becoming the gambling regulator, isn't there? Yeah, it's a challenging one and it's no doubt going to be a long process.

The main action, as you say, of banning the pogo hubs is driven by an overall ambition to kind of clean up the sector in the region and clean up the region's gambling reputation, which has kind of plagued it recently and in recent times with them being on the FTAF gray list as well. But the Padcore chairman kind of underlined just that this is a process and that whilst

They couldn't guarantee that bad actors would no longer look to engage in illicit activities. They are looking to really increase the obstacles towards these illicit activities and make it harder for them to be engaged with. And one of the ways they're doing this is increasing the monitoring. They're going to really strengthen the way they monitor the 43 companies that currently hold offshore gaming licenses.

And this is the first kind of approach before getting rid of the POGO hubs. mentioned there, Joe, that their aim is to, well, they're currently on the financial action task force, the grey list. When are there aims to be delisted from that? There were ambitions to be delisted, I think for, there were initial plans for February of this year. But I believe it might be moved to 2025. Yeah, but it's going to be moved. I think it was February of this

Andrew McCarron (11:47.566)
It was early this year anyway. There were aims for that. They weren't removed. They were unsuccessful in that one. However, there are ambitions and there's growing optimism as well that they will be removed by 2025 at the latest. That, I would say, comes even amidst challenges from largely presented from the gaming sector of money laundering allegations and events like that. Because

Yeah, but it comes amidst that. And I think the efforts to clean up the gambling sector will be certainly fuel to getting them off this list. And I think will certainly help in accelerating that process and will have largely contributed to the optimism around them finally leaving the FTAF gray list. The other thing about the Pogo hubs that is really worth mentioning that is kind of imperative to

hasn't worked since 2019 is they've kind of become a hub, just for illicit gambling, but there's been instances of human trafficking and other illegal activities that have kind of plagued, stained the reputation of the gambling industry, the wider gambling industry in the sector. So I think that's had a big part in why they are looking

eradicate the POGO hubs and are looking to tighten frameworks around the gambling industry. you only have to look at the numbers from the recent release financial report to show the indication of not only just what net income and revenue that can possibly be generated from these operations, but also how those operations can contribute towards

government initiatives that help out the country in numerous different ways. So it's one of the reasons why they want to clamp down on the offshore and to really solidify their presence as a gambling regulator so that they can better protect players, but also provide that vital support for government initiatives as well. Perfect. We're running out of

Andrew McCarron (14:06.988)
a little bit for this podcast, but I do want to touch upon something that I mentioned in the introduction, and that was that the Filipino government locked horns with China. Joe, can you just explain what's been happening here? Because it was, I believe, a few months ago? I mean, it kind of forms part of a wider effort from China and from the Chinese embassy, just warning citizens against offshore gambling. they've lobbied the Philippine government

kind of strengthen their action against offshore gambling activity. This was prior to the action we are now seeing from the Philippines. So interesting there. I can read you the statement from the Chinese embassy if you want not to be a mouthpiece for, but it is interesting and obviously the impact it has had. Obviously China are big player in that region especially and their political weight will have some thrust.

They just emphasise that Chinese law prohibits all forms of gambling. The Chinese society strictly cracks down on Chinese citizens engaging in gambling businesses abroad, including Pogos, which is obviously very significant. They also stated, and this is from them, that there's ample evidence that shows that Pogos breed serious crimes such as kidnapping for ransom, human trafficking and murder. Pogos are detrimental to both Philippine and Chinese interests.

as well as Chinese -Philippines relations. yeah, that's obviously going to have a big impact. I mentioned it was part of a wider approach. China's also strengthened ties on this with South Korea and other nations in the region to really combat offshore gambling of Chinese citizens. it's tough. Obviously, know restrictions are tight for Chinese citizens.

Yeah, it obviously would have had an impact. But yeah, seemingly to the benefit of the Philippines as well, if they can clean up their gambling act, they've taken the steps that are needed to get off the FTAF grey list. So that is a massively positive thing for the region. Even after this pressure from the Chinese, the future does look bright for the Filipino gambling sector. think that's a nice way to

Andrew McCarron (16:29.646)
This podcast is a lot to digest. This is kind of a 2024 rundown of what's been happening in the Philippines. No doubt there's more to come in the next six months or so. And for all the information, keep your eyes on Casino Beats where Joe, Connor and Danny Lee will be covering all the latest updates and keep your ears out for iGaming Daily because no doubt we will cover this later on further down the line. But apart from that, I've been James Ross. I've been joined by Joe Streeter and Connor Porter, and this has been iGaming Daily. Thank

Creators and Guests

James Ross
Host
James Ross
Multimedia Editor at SBC Media
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Guest
Conor Porter
Senior Journalist at CasinoBeats and SlotBeats
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Guest
Joe Streeter
Editor of Insider Sport and Payment Expert
Ep 306: Philippines continue 2024 illegal gambling crackdown
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