DOF chief: China respects PH sovereignty on Pogos

The country’s online gaming industry found some relief on Friday after Chinese leader Xi Jinping made no specific request to President Duterte to ban the controversial but booming industry, according to Secretary Carlos Dominguez III of the Department of Finance (DOF).

The Chinese leader, however, also made known to Mr. Duterte his resistance to gambling as it involved Chinese nationals, a position articulated earlier by the Chinese Foreign Ministry and also affirmed by Mr. Duterte’s spokesperson and by Dominguez himself on Friday.

A DOF statement quoted Dominguez as saying that “China respected the Philippines’ sovereignty over the government’s policy on gambling during President Rodrigo R. Duterte and Chinese President Xi Jinping’s meeting in Beijing.”

The finance secretary, who accompanied the President in the two-and-a-half hour bilateral meeting on Thursday, also said “the Chinese leader did not ask or request the Philippine Chief Executive to ban offshore gaming operations, which mostly employ Chinese nationals.”

On the other hand, Dominguez also noted, “He [Mr. Xi] applauded the moratorium on new licensees in the Philippines.” The finance chief said this was in response to the Philippines’ move to stop accrediting new Philippine gaming offshore operators (Pogos).

“President Xi basically said that gambling is totally banned in China except in Macau where they tolerate gambling,” Dominguez also said.

‘What we will lose’

He said he “believes President Xi’s statement regarding Pogo during his meeting with President Duterte was just ‘a comment,’ noting the Chinese leader knows and respects the Philippines’ sovereignty.”

Mr. Duterte “took note of President Xi’s comment,” he added.

Speaking to reporters after the bilateral meeting in Beijing, presidential spokesperson Salvador Panelo said “President Xi expressed appreciation for what we did in suspending new (Pogo) applicants.”

“But he said they will appreciate more if Pogo will be eliminated or stopped,” Panelo said.

“The President has not said anything about it, but I suppose he will have to study [it],” Panelo said. “We have to look into what we will lose if we stop online gaming. Will it affect the [national] budget? You must remember revenues are coming in [from Pogos]. They have to consult with the finance department [regarding] its effects.”

Strict rules, regulations

“Right now, what we can do is to be very strict on [Pogos], following rules and regulations, and the law. That’s what we can do,” Panelo also said.

On April 20, Chinese Foreign Ministry spokesperson Geng Shuang said Beijing welcomed Manila’s suspension of the issuance of new licenses for Pogos and “we hope the Philippines will go further and ban all online gambling.”

Sovereign decisions

Philippine Ambassador to China Jose Santiago Sta. Romana on Thursday maintained that China could not order the Philippine government to shut down online gaming companies catering to Chinese citizens.

“They cannot dictate on us. Those are sovereign decisions. That is where we stand,” Sta. Romana said hours before the meeting between the two leaders.

Economic Planning Secretary Ernesto Pernia earlier said the online gaming industry should be carefully studied before the government decides its fate, describing the issue as “fluid.”

Multibillion-peso take

Bangko Sentral ng Pilipinas Governor Benjamin Diokno said he is “open minded” about the offshore gaming operations in the country.

The Philippine Gaming and Amusement Corp. estimated that licensing fees and royalties from Pogos would hit P8 billion this year, up 33 percent from P6 billion last year.

This is on top of the P12 billion contribution to the national government since the formerly unregulated industry was legalized three years ago.

The Bureau of the Internal Revenue is also estimating around P24 billion in withholding taxes coming from the foreign nationals working in the Pogo industry.