POGOs: Masama o Maganda?

The emergence of Philippine Offshore Gaming Operators (POGOs) has sparked a wide array of discussions and debates, but is it a boon or a bane for the Philippine economy?

This blog aims to explore both the positive and negative impacts of POGOs on the Philippines, shedding light on the multifaceted nature of this industry. Let us consider whether POGOs should be allowed in the country or banned altogether.

Positive Impacts

Economic Boost

POGOs have injected significant foreign investments into the Philippine economy, creating jobs and stimulating various sectors.

Foreign Investments

The industry has attracted substantial foreign investments into the Philippine economy. These investments often come as a capital infusion for setting up and operating online gambling platforms and investments in real estate and other related sectors. The influx of foreign capital boosts economic growth, stimulates business activity, and enhances the country’s international economic connections.

Job Creation

The POGO industry has created a significant number of employment opportunities for Filipinos. These jobs range from technical support staff, customer service representatives, IT professionals, administrative personnel, security personnel, maintenance workers, and more. This also helps reduce poverty and improve livelihoods.

Tax Revenue

The Philippine government has implemented regulations to ensure this gambling sector and its employees contribute to the country’s tax revenues. Government revenue sources include licensing fees, corporate taxes, income taxes from operators, and personal income taxes from foreign workers. These funds can be allocated to various public services and infrastructure development, benefiting the general population.

Economic Spin-Offs

Its economic benefits extend beyond the industry itself. The increased disposable income of POGO employees multiplies the economy, leading to higher consumer spending in local businesses such as restaurants, retail shops, and entertainment venues. This, in turn, can create further employment opportunities and support the growth of the domestic economy.

Real Estate and Property Development

The presence of such an industry has driven demand for office spaces, residential properties, and commercial establishments. This has led to a surge in the real estate sector, boosting property values and creating business opportunities for construction companies, developers, and property agents.

Recently, there have been significant issues with both the eSabong and Philippines Offshore Gaming Operator (POGO) divisions. In the past, POGOs brought in millions of cash for the Philippines. However, a plan to increase their tax rate ran into trouble.

Negative Impacts

Social Concerns

Critics argue that POGOs can contribute to social issues such as gambling addiction, crime, and money laundering. The accessibility of online gambling platforms and the influx of foreign workers have raised concerns about the potential negative effects on individuals and communities.

Since 2019, there have been over 300 victims in 102 POGO-related crimes, with at least five percent of those criminal activities have involved human trafficking. This risks the Philippines regarding the Financial Action Task Force (FATF).

The FATF is responsible for combating money laundering and terrorism financing. If the country is included in the blacklist of this organization, it only means that the policies in mitigating and preventing these criminal and terrorist activities are inadequate and ineffective.

Strain on Infrastructure

This gambling industry’s rapid growth has strained infrastructure in certain areas. Increased demand for utilities, transportation, and public services can lead to congestion, overburdened resources, and challenges in maintaining a balance between development and sustainability.

Sovereignty and Security

The high concentration of Chinese nationals working in the POGO industry has raised national sovereignty and security concerns. Immigration, law enforcement, and potential infiltration by criminal elements have been subjects of scrutiny and debate.

Should the Philippines Ban POGOs or No?

From an economic standpoint, POGOs have brought in foreign investments, created jobs, and generated tax revenue, positively contributing to the Philippine economy. The real estate sector has also experienced growth due to the demand its operators generate. These factors can be beneficial to the country’s overall development.

However, concerns associated with it cannot be ignored, so regulators, policymakers, and society must carefully consider and manage the industry to mitigate the negative impacts while maximizing the potential benefits.

While the Senate has considered banning POGOs, it is an important asset for developing and restoring the economy vastly affected by Covid-19. Further investigation should be made before having this sector taken down permanently.

READ: How to Avoid Fraudulent Casinos