The Philippine government would like to invite bids from the private sector – by year-end – for the publicly-run casinos of operator-cum-regulator the Philippine Amusement and Gaming Corp (Pagcor), but the country’s Finance Secretary said he had not yet personally received any expressions of interest.
That is according to a Monday story in the Philippine Inquirer newspaper.
It’s better [for the government] to move out of [casino operations],” Carlos Dominguez was reported as saying.
“It will remove the conflict of interest when you are the regulator,” the country’s finance boss additionally said, in comments on the sidelines of the Asian Development Bank’s 50th annual meeting in Japan.
“Personally, I haven’t gotten [offers] because they [the authorities] haven’t set out the terms of the privatisation,” Mr Dominguez reportedly stated.
“You have to set out the terms, then people will come. Of course, we will make it attractive since we do want to raise the revenues from this and remove the conflict [of interest] that’s ongoing,” he added.
Pagcor directly operates a suite of state-run casinos and oversees a number of private-sector ones. Its own brand of casinos is called “Casino Filipino”. According to the latter’s website, the brand operates venues in eight locations across the country, and has a further 36 so-called “satellite” sites across the Philippines.
In its first-quarter earnings statement, issued in April, Pagcor didn’t give a breakdown on how much money had been earned by the private-sector venues, and how much by the public-sector ones during that period.
The most recent such data split provided by Pagcor was for the third quarter of 2016. According to that information, its own casinos operated nearly a third of all table games in that nation’s market during the period, and nearly six out of every 10 electronic gaming machines (EGMs).
Pagcor operated at that time 565 gaming tables and 10,271 EGMs at Casino Filipino venues.
During the same period, Pagcor regulated a further 10 private-sector casinos that operated an aggregate of 1,280 gaming tables and 7,205 EGMs. Since then, one large-scale new private-sector venue has opened – Okada Manila, promoted by Japanese gaming entrepreneur Kazuo Okada.
In the first nine months of 2016, Pagcor-operated casinos recorded gross gaming revenue of PHP23.88 billion (US$478.9 million), up by 5.7 percent from the prior-year period, according to official data.
Nationwide casino GGR for the first nine months of 2016 – including revenue from the private casino sector – increased 19.8 percent year-on-year to PHP99.77 billion.
In August 2010 – during the administration of President Benigno Aquino – the boss of San Miguel Corp, one of the Philippines’ biggest conglomerates, expressed an interest in buying Pagcor for US$10 billion. In the end the idea did not move forward.
In December 2015 during the closing months of Mr Aquino’s presidency, a government commission had recommended the privatisation of Pagcor’s casino operation function, so that it could focus instead on regulating the sector.
In August – following the election of President Rodrigo Duterte in May 2016 – Mr Dominguez had been quoted saying the government was “seriously” considering privatising the operations of Pagcor’s directly-managed casinos.
According to the regulator’s website, under Pagcor’s charter and relevant national laws, 5 percent of Pagcor’s “winnings” goes to the Bureau of Internal Revenue as franchise tax; while 50 percent of the 95 percent balance “goes to the national treasury as the national government’s mandated income share”.
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Rate of VIP gross gaming revenue year-on-year growth in the second quarter of 2018 in Macau