CLARK, Pampanga - The Philippine gaming industry is the "next market to watch," with the ambitious 120-hectare integrated casino and tourism hub in Manila expected to trump those in Las Vegas and Singapore in the next 4 years.
The Philippine Amusement and Gaming Corp. (Pagcor) expects revenues from the "Entertainment City" to hit $10 billion by 2016, when all four locators start full operations.
"A research report by Citi group tagged the Philippines as the next market to watch. It said total revenue to be derived from gaming here will compare with Singapore's $6.7 to $7 billion," said Pagcor chairman Cristino Naguiat during a forum organized by the Economic Journalists Association of the Philippines and San Miguel Corp.
"But I'm more bullish than Citi. I'm looking at at least $10 billion revenues when the Entertainment City is completed, far greater than Las Vegas and Singapore."
With a minimum investment of $1 billion from each of the companies developing Entertainment City, the Philippines stands to gain enormously from the integrated resorts.
Naguiat said the project can accommodate an additional 1 million tourists who will spend not only for gaming, but other leisure and entertainment activities.
"This is one-tenth of the Department of Tourism's arrivals target of 10 million by 2016,” he said, adding that some 40,000 direct jobs will also be created.
He said the Philippine casinos aim to attract mainly the huge mainland Chinese market, and neighboring countries in the region.
Entertainment City's four project proponents include Bloomberry Hotels and Resorts Inc., whose Solaire Manila project will open next year; Tiger Resort Leisure and Entertainment Inc., which will develop the Manila Bay Resorts; and the SM group and Travellers International. SM's Belle Grande project will open its first phase in 2013, while Travellers' Resorts World Bayshore will break ground June this year.
To improve access to the casino hub, Naguiat said locators are putting up a P6 billion fund to partly finance the construction of a tollway linking it to the three terminals of the Ninoy Aquino International Airport. He said the project could be bid out by government next month under the public-private partnership program.
Naguiat said, meanwhile, that two smaller casinos within the area will have to close down eventually. He said the lease contracts of casinos at the Heritage Hotel and near the international airport will expire 2013 and 2014, respectively.
Pagcor is aiming to grow its revenues by 25% this year to P45 billion from P36 billion in 2011 as it continues to package gaming and tourism to overseas travelers.
Naguiat said growth will be driven by the renegotiation of contracts with licensees and service providers that have resulted in a bigger share of revenues for Pagcor.
"We were able to negotiate contracts to a 65-34 revenue sharing, in favor of government, from 60-40 before. We were also able to have marketing, janitorial and security expenses charged to them."
Naguiat said they are studying proposals from other companies that want to develop casinos in the provinces.
"There are a lot seeking licenses. We're very open, but they have to put a big investment in the island or province first, say $500 million, before we give them licenses."