Pagcor to hike minimum capital for new casinos

MANILA, Philippines - The Philippine Amusement and Gaming Corp. (Pagcor) is contemplating on raising the minimum capital requirements for new entrants to the local casino industry to ensure their financial capability.

Pagcor chairman Cristino Naguiat said he is looking at a minimum capital requirement of $1.5 billion for casino companies that will operate for the first time in the Philippines, 50 percent higher than the current requirement of $1 billion.

The terms of reference are now being fleshed out by the agency and are expected to be finalized within the year.

Naguiat said several foreign casino firms have signified interest to set up shop in the Philippines to capitalize on the rosy prospects of the local gaming industry.

Among them is US-based casino giant Caesars Entertainment Corp., which submitted a letter of intent to open a casino in the Philippines, Naguiat said.

He declined to name the other entities that expressed interest to enter the Philippine gambling industry.

Caesars is hammering out a reorganization plan that will pave the way for a restructuring of $18.3 billion in debt after incurring massive losses since 2009. 

Naguiat is confident that Entertainment City, the country’s version of gaming hubs like Las Vegas and Macau, would boost more foreign investments into the Philippines and provide employment to as much as 80,000 Filipinos once completed.

Philippine gaming revenues are seen to grow double digit this year with the opening of Macau casino giant Melco Crown’s City of Dreams in Manila. This figure is expected to increase further to up to $7 billion by 2020 with the full development of the 100-hectare Las Vegas-like gaming and entertainment hub along Roxas Blvd.

Naguiat said the local gaming industry can easily post double digit growth this year from $2.2 billion in recorded revenues in 2013. 

City of Dreams Manila, a joint venture between Melco and retail tycoon Henry Sy’s Belle Corp., is slated for opening in December this year, featuring six hotel towers with a total of 950 rooms from three hotel brands as well as a number of high-end specialty restaurants and bars.

The development of Entertainment City is in line with Pagcor’s strong commitment to the government’s program of making tourism one of the main engines of economic growth and hitting the national target of 10 million tourist arrivals by 2016.

Gaming revenues currently come from 13 relatively small casinos throughout the country run by the government, and a bigger one in Manila operated by the Travellers Group.