Philippine gaming market seen growing fivefold in 5 years
The Philippine gaming market can grow fivefold over the next five years with the opening up of the local industry, breaking the monopoly previously held by state-run Philippine Amusement and Gaming Corp. (Pagcor).
Belle Corp., one of four companies authorized to put up hotels and casinos at the Pagcor Entertainment City in Parañaque City, said the prospects were bright for the gaming industry, which is expected to attract customers from across the Asia-Pacific region.
“The Macau gaming market is worth about $35 billion in revenues. The Philippine gaming market makes only $1 billion. For us to get just 2 to 3 percent of that market means we can double our own revenues,” Belle Corp. vice chairman Willy Ocier said.
The company listed P4.5 billion worth of shares on Monday. These were issued earlier this year as part of a stock rights offering. Proceeds of the offer will be used to fund the construction of the company’s Belle Grande Manila hotel and casino. The company hopes to open the project by the first quarter of 2013.
Speaking to reporters on Monday, Ocier said the liberalization of gaming industries in different countries have always resulted in an exponential increase in revenues, contributing to job creation and better economic prospects.
In Macau, which is now the world’s leading gaming market, industry revenues were at about $1 billion a year when businessman Stanley Ho monopolized the market. Opening up the industry paved the way for the entry of leading hotel and casino operators, helping the industry grow to where it is now.
Another example is Singapore, where revenues are now at $5 billion a year, up from zero three years ago. Ocier said the island-nation was able to achieve this feat with just two casinos—Resorts World in Sentosa and the Marina Bay Sands.
He said the Philippine gaming market has been able to duplicate this to some extent when private companies were allowed to put up casinos. He said that Resorts World Manila, the hotel-casino venture operated by Andrew Tan’s Megaworld Corp., was able to double the market’s size on its own.
Once the hotels and casinos at the Pagcor Entertainment City are operational, Ocier said the country would be able to attract more foreign tourists, particularly from China. The four groups participating in the Pagcor project are required to put up 8,000 hotel rooms each before they can be allowed to operate a casino.
“We are confident to see the Philippine market grow to as much as $2 billion to $5 billion in size in the next five years,” Ocier said. Mainland China will likely be the main market for local casinos. At the moment, Macau is the most convenient market for Chinese customers. “But every Chinese citizen is allowed to visit Macau only once every three months. So the only other choices for avid gamers are the Philippines and Singapore,” Ocier said.
“Singapore is four hours away by plane from southern China. The Philippines is much nearer,” Ocier said. “A lot of people want to go to the Philippines and they are just looking for a reason to do so,” he said.
Aside from Belle, other franchise holders for the Pagcor Entertainment City are Japan’s Aruze Group, Megaworld and Bloombury Investments of businessman Enrique Razon Jr.