Keeping POGO operations to weaken tourism, foreign investments — officials

Metro Manila (CNN Philippines, October 19) — The Philippines may see a drop in Chinese tourist arrivals and become less attractive to investors if the government decides against stopping online gambling operations, economic agencies said Wednesday.

During a House Committee on Labor and Employment hearing, the National Economic and Development Authority (NEDA) cited two sources of economic costs: Chinese tourism loss and the existence of fraudulent transactions.

"Maintaining POGO operations places the country at risk of being included in China's blacklist, thereby losing Chinese tourists and their contributions to GDP (gross domestic product)," said NEDA Assistant Secretary Sarah Lynne S. Daway-Ducanes.

During a peak of tourist arrival from China, she added, around 1.7 million visited the Philippines, contributing 0.7% of the GDP.

As one of the country's top source markets, the influx of Chinese tourists triggered additional direct and indirect employment of more than 100,000, the official said.

Senate President Juan Miguel “Migz” Zubiri earlier claimed the country was on the tourist blacklist of China. The Chinese Embassy later denied this.

READ: Chinese Embassy: PH on tourist blacklist is ‘misinformation’

NEDA also presented a previous report from the Anti-Money Laundering Council (AMLC), which disclosed that about ₱14 billion out of the ₱54 billion POGO transactions between 2017 and 2019 were flagged as suspicious.

"Given the government's desire to attract more employment-generating investments, both local and foreign, the existence and effects of such fraudulent activities did not bode well for creating an economic environment conducive to these investments," Ducanes said.

An executive from the Department of Finance (DOF) echoed NEDA's statement.

"Aside from concerns with respect to tourism..., it can have an effect on foreign direct investments," DOF Undersecretary Maria Cielo Magno said.

Magno added potential losses to foreign direct investments might reach ₱16.7 to ₱26.2 billion amid the issues hounding POGOs, especially the crime-related ones.

READ: Gov’t agencies intensify efforts vs. POGO-related kidnapping cases