The Philippines is setting its sights on becoming the world’s second largest gaming market, as the Entertainment City complex in Manila, owned by state-run agency Philippines Amusement and Gaming Corporation (PAGCOR), continues to develop.
PAGCOR chairman, Cristino Naguiat Jr, predicted that the Philippines’ gross gaming revenues would reach US$6 to 7 billion in five years’ time, beating Las Vegas’ revenues and being comparable or exceeding Singapore’s. Naguiat acknowledged it would not be able to match Macau, which saw gambling revenues of over US$45 billion in 2013, thanks to its proximity with China. However, with the Philippines’ strategic geographical location, it expects to become a gaming hub, ranking second or at least third in the world.
The Philippines’ gaming revenues in 2013 fell short of its US$2.5 billion target, reaching US$2.2 billion instead. At least part of the shortfall could be attributed to disputes with China over territories in the South China Sea, and Hong Kong over the 2010 hostage crisis.
Still, the Philippines saw a double-digit increase of 10 percent from its 2012 revenues, and Naguiat said double-digit growth was also expected for 2014. A total of “at least” US$2.5 billion would be reached in 2014, Naguiat predicted.
Fitch ratings agency also expects double-digit growth will continue until at least 2015, though it doubted whether the Philippines could surpass Singapore before 2020. It pointed out that the country would need to upgrade its transportation infrastructure, in particular its airport, before it would be able to handle large increases in tourist numbers.
Manila’s model is based on Las Vegas’s system, where non-gaming revenues outperform gaming revenues. Las Vegas’ gaming revenues account for less than half of the city’s total revenues. Instead, the city provides a more rounded tourism experience, and makes more from its shows, accommodation, clubs, restaurants, and shopping.
In Macau, gaming revenues make up a far higher percentage of the city’s total revenues, accounting for 80 percent of tax revenues last year. The majority of Macau’s tourists are day-trippers from China, there with the sole intent of gambling. In contrast, Las Vegas’ visitors stay an average of 3.7 days.
Naguiat stated that the Philippines was not focused solely on increasing its gaming revenues, but also expected its non-gaming revenues to grow over the next few years. He saw no reason why the Philippines could not become the “Broadway” of Asia, as a result of the country’s theatrical talents.
The aim is to attract gamblers from across Asia, and especially from China. With many more Chinese tourists wanting a more international and entertainment-based approach to their gaming habits, Manila offers an attractive alternative. Flights to Manila from Hong Kong take around two hours only. There are more than 15 flights per day, and most of the larger gaming resorts in Manila are close to the international airport.
PAGCOR currently operates 13 casinos in Manila and the country’s major island groups. The casinos are entertainment centers, offering shows, fine dining, karaoke, and dancing in addition to gaming. With the Pagcor Entertainment City alone expected to generate more than 40,000 jobs, mostly in hospitality, the gaming industry will likely have a huge impact on the shape of Manila as a tourist destination.
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