Philippine offshore online gaming companies hit hard by the epidemic, and now they are just around the corner

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Bookmaker
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Philippine offshore online gaming companies hit hard by the epidemic, and now they are just around the corner

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The Philippines has allowed multinational online gambling companies to set up in the Philippines since 2016. As long as gamblers come from outside the Philippines, they are called Philippine Offshore Gaming Operators (POGOs). Philippine Offshore Gaming Operators (POGOs) were once quite prosperous, reaching 56 in 2019. In addition, there are at least 30 illegal operations, many of which are invested by Chinese funds, including South Korean and Vietnamese operators, but they were once shut down under the global new crown epidemic, and now they are starting to move again.

In 2019, POGOs have become an important driving force in the Philippine office building market, occupying 800,000 square meters of floor space, but most of the people employed are expatriates from the company's home country, and only 17% are Filipinos. In 2019, Philippine offshore gaming companies employed a total of 138,000 foreigners, most of whom were Chinese, and the deformed human structure also caused the scourge of the global new crown epidemic.

When the global traffic and people flow stopped due to the epidemic, the Philippine offshore gaming companies were empty and almost completely unable to operate. 30% of the offshore gaming companies withdrew, and 70% stayed, but the business of those who stayed was also greatly reduced, resulting in the release of 454,000 yuan. Floor area in square meters. During the epidemic in the Philippines, a total of 1.6 million square meters of office floor space was idle, one of the main reasons was from offshore gaming companies. More than half of the massively vacant offices in the financial hub of Makati were previously offshore gaming companies.

The demand for the offshore gaming company industry continued to grow rapidly until the second quarter of 2020, which led to a sharp increase in the contracted floor area of ​​the Philippine office in the first half of 2020, but it stagnated in the third quarter of 2020. In China, it is impossible to come back to work, so the business is suspended. From the first quarter to the second quarter of 2021, due to the counterattack of the Philippine epidemic and the impact of the Philippine Internal Revenue Service’s “Bayanihan 2” tax increase on gaming companies, offshore The contracted area of ​​the gaming company's office has been greatly reduced by 50%.

Under the influence of offshore gaming companies, the overall office market in the Philippines fell by 43% in the second quarter of 2021, with 135,000 square meters of contracts signed. However, the contracted area of ​​the IT and financial industries is on the rise, rising to 36,000 square meters from a low of 8,000 square meters in the first quarter of 2021.

As the global epidemic seems to be entering its final stage, offshore gaming companies are also ready to move. Many Chinese companies are returning to the Philippines and preparing to resume operations. Leechiu Property Consultants said that the offshore gaming company industry now needs 17,000 square meters. Meter floor area office space. Li Chao Real Estate Consultants believes that the sharp drop in the contracted area in the second quarter may partly reflect the result of seeking new offices.

Regarding the impact of the "Bailout Law", it is generally believed that tax increases will drive away many offshore gaming companies. Li Chao's real estate consultants have a positive view and believe that clearer regulations are actually beneficial to the industry.

The current epidemic situation in the Philippines is still serious, but if the epidemic situation in the Philippines is brought under control and gradually ends, offshore gaming companies will soon be reborn.
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