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BSP taps AMLC to study POGOs

Bangko Sentral ng Pilipinas Governor Benjanmin Diokno (left) listens as Socio Economic Planning Secretary Ernesto Pernia talks during the 3rd EJAP Economic Forum on Tuesday, August 27, 2019. PHOTO BY RENE DILAN

THE Bangko Sentral ng Pilipinas (BSP) has tapped the Anti-Money Laundering Council (AMLC) to study the impact of Philippine offshore gaming operators (POGOs) on the country’s economy.

At the Economic Journalists Association of the Philippines (EJAP) Economic Forum in Manila on Tuesday, BSP Governor Benjamin Diokno told reporters that the central bank had “authorized the study to find out if it [would] be good for the country if we keep or discontinue the POGO.”

“We are already studying the possibility of putting some sense to this online gambling,” he added.

According to the BSP chief, the study would also determine POGOs’ impact on other areas, such as the real estate and food industries.

“It’s true that they occupy a big chunk of real estate in the country. What if, all of a sudden, they decide to back out? What [would] be the impact of that [on the] property sector?” Diokno asked.

He stressed that the Bangko Sentral’s decision to have the study conducted was in line with its mandate of maintaining financial stability.

“One of the mandates of the BSP is financial stability, so we look at all the industries [and] conglemerates and see whether they pose financial risks. That’s what we are looking at the POGO issue,” Diokno said.
The central bank’s new charter also gives it more oversight powers over its supervised institutions, according to him.

“We can actually require any individual or firm [to disclose] information that is related to financial stability. We can subpoena individuals and companies to give us information on things that we think has something to do with financial stability,” the central bank governor said.

If warranted, the BSP will exercise its oversight power to determine the exposure of real estate firms to POGOs, Diokno said.

“It’s in our power. So yes, we are going to do it. As you know, this financial stability of the central bank arose because of what happened [during] the global financial crisis [of 2008], which started in the housing sector, so we are now looking at conglomerates,” he added.

Real estate firms in the country are mostly owned by conglomerates, including SM Investments Corp., Ayala Corp. and Alliance Global Group Inc.

For his part, Socioeconomic Planning Secretary Ernesto Pernia said the presence of online gambling and foreign workers in the country actually benefited the real estate sector.

He admitted, however, that it was hard to determine POGOs’ full economic benefits to the Philippines due to the sector’s fluid operations.

Pernia suggested that POGOs should operate outside Metro Manila, as the influx of foreign workers, who are mostly Chinese, affects the cost of basic services, like rentals, in the country’s key cities.

“I think there’s too much of [the] overbuilding of offices and condominiums in Metro Manila. They should move to the regions….” he said.

Earlier this month, the Philippine Gaming and Amusement Corp. (Pagcor) stopped accepting applications for new POGOs after being scrutinized because of reports that it employed undocumented workers from China, who do not pay taxes to the government.

Pagcor said the offshore gaming sector is was on track to meet its revenue target of P8 billion this year and P9 billion to P10 billion next year.

Since 2016, the industry has earned P16 billion.

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