Benjamin Diokno, the Philippines’ Department of Finance Secretary, announced the plans for the Philippines casinos. The plans for privatization have been recently resurrected, and PAGCOR is about to privatize them.
Diokno claimed that it isn’t right that the agency keeps fulfilling two roles, both of a regulator and an operator.
PAGCOR as the main contributor:
In the middle of the debate about the potential creation of the sovereign wealth fund, Diokno spoke to local media about these events. He claimed that PAGCOR was supposed to be a key contributor, which was crucial to clarify the regulator’s role. It will be done by privatization 47 casinos that are currently under the watch of the country.
Speaking of the recent events, Diokno added: “PAGCOR is a regulator, but at the same time, it operates gambling companies. That’s wrong. If you’re a regulator, stick to that. You cannot run gambling casinos.
“It’s like saying that you have a central bank, and yet you’re also running a bank. That cannot work. We can privatize its operations so PAGCOR can stick to being a regulator.”
Phillippines’ Governance Commission for GOCC is still thinking about this project. However, Alejandro Tengco, the PAGCOR chair, said that the possible privatization sounded appealing. He commented on this shortly after being sworn into the new office, which happened in August.
Rufus Rodriguez, House Speaker, wants a dedicated casino regulator instead of complete privatization. It means PAGCOR will only stay as an operator.
The company has to pay the huge commissions:
As the critics listed, the main reasons against complete privatization are the sizeable revenues of PAGCOR’s casinos. In 2019, the company had to pay the country more than Php 56 billion, or US$1 billion. Payments have been made through the required contributions and social responsibility programs.
There is also a proposal regarding investments and funding. So, there is a possibility for Maharlika Wealth Fund. It may be investing in global infrastructure projects and financial markets across the whole world. The investors will be receiving 10% of the gross income PAGCOR casinos earned from gaming.
In total, this is really a huge amount of money – which made former Chairman and CEO Andrea Domingo abandon the thoughts of privatization last time when it was on board.
In 2018, it was said to IAG that the company has a strong cash flow, and the privatization of the Philippines casinos wasn’t a necessary step.