Chinese Visitation to Philippine Casinos Hinges on Politics

Political risks could weigh heavily on Philippines’ booming casino industry, which has enjoyed increasing Chinese visitation over the last year, said Bloomberg analyst Margaret Huang in an interview with Philstar.

Over the last year, diplomatic efforts from Philippine President Rodrigo Duterte with China, along with an easier visa process for Chinese visitors, has helped bring more tourists to the country than ever before.

According to data from the Bureau of Immigration provided to Philstar, a total of 3.1 million Chinese citizens arrived in the Philippines from January 2016 to May 2018, with 717,638 Chinese nationals visiting the country in the first five months of 2018 alone.

“Part of the reason why Chinese gamblers go to the Philippines is due to relaxed visa requirements. They can now get visa upon arrival and more flight routes have been added,” said Huang.

“If this were to reverse, there will be less incentive attracting the Chinese as they can easily go to Macau,” she added.

Huang said the Philippines has seen more Chinese gamblers partly due to the fact that there is less government scrutiny compared to gambling in Macau. More attractions in the Philippines could also extend Chinese visitor stay.

“In addition, Chinese premium mass gamblers in Macau can opt to visit the Philippines and be considered a VIP patron as wagers in the latter is smaller compared to Macau,” Huang said.

“Junket operators are also likely to offer Chinese premium mass gamblers an opportunity to gain a VIP experience at the Philippines,” she added.

That being said, Huang stressed that the Philippines still has a long way to go before it can match Macau revenue.

“Macau is heavily integrated with China, its largest source of premium gamblers. With the sustained growth of Macau’s revenue growth through greater connectivity to mainland, it is not a fair comparison to the Philippines,” she said.

Huang said the Philippines has great potential to capture Chinese premium gamblers, but the success of this would hinge mainly on the country’s casino regulatory framework.

“PAGCOR must focus on regulation rather than being both operator and regulator,” she added. (AGB)