MANILA, Jul 23 (NNN-PNA) – Philippine Finance Secretary, Ralph Recto, said today that, banning the Philippine Offshore Gaming Operators (POGOs) would not significantly affect the economy, because the costs of keeping POGOs far outweigh the benefits.
In his State of the Nation Address yesterday, Philippine President, Ferdinand Romualdez Marcos, announced the banning of all POGO operations in the country, ordering the Philippine Amusement and Gaming Corp. to wind down and cease the operation of POGOs by the end of the year.
Recto welcomed the ban as POGOs “come with significant reputational risks.”
“We have seen the negative impacts and destruction (the POGOs) have caused to our country because of crimes. Banning them won’t significantly affect the economy because the costs of keeping them outweigh the benefits,” Recto said.
In a cost-benefit analysis, the Department of Finance estimates showed that, the net cost of POGO operations reached around 99.52 billion pesos (1.7 billion dollars) annually.
According to the analysis, POGOs’ estimated total economic benefits are only 166.49 billion pesos (roughly 2.85 billion U.S. dollars) per year, significantly lower than the estimated total economic costs of 265.74 billion pesos (4.55 billion dollars) annually.
Recto said, the estimated economic costs of POGOs include the undesired effects of reputational risks, which impact foreign direct investments. POGO-related crimes also negatively affect the country’s attractiveness as a tourist destination.
Social costs entailed by POGOs are unquantifiable, said the finance chief, adding that, POGO operations also affect communities by increasing fear and anxiety associated with illegal activities.– NNN-PNA