Colombia took center stage in the Latin American gambling world Wednesday as it was recognized by Clarion Gaming as Jurisdiction of the Year at the opening of Juegos Miami.
In accepting the honor, Evert Montero Cardenas, Juegos Miami’s non-executive chairman and President of the Colombian trade body Fecoljuegos, said the country’s economy continues to grow, citing how its gaming industry expanded after the introduction of online gaming regulations in late 2016.
But he also sounded a warning about the future role of gaming in Colombia after the presidential election on June 17. The field was narrowed to two candidates after the first round this month – economist and former Bogota Mayor Gustavo Petro, the left-leaning candidate, and Ivan Duque Marquez, the right-wing candidate and a former member of the Colombia Senate.
Cardenas, in a translation from Spanish, said, “Colombia has a very solid and strong economy,” is open politically, and offers business opportunities and guarantees to develop. He wants that to continue.
“We have two candidates that will go to the second balloting, and we hope the future president of Colombia will give the same conditions to our industry, so we can develop and thrive and get stronger,” Cardenas said.
He worried that left wing governments “abolish business activity” as “the first thing” they do when taking power.
“This is our main concern with one of the candidates,” Cardenas said. “We have been doing our own political analysis on the future projections, and we have one candidate that is more left-leaning (and one that is) more-right leaning. We’re concerned about the problems that Venezuela has been facing and Ecuador has been facing… that they can occur in Colombia.”
Cardenas said Colombia needs “to close ranks and vote for the person that gives us full guarantees (that) our business activity will continue to be vibrant and profitable and generate wealth for all. … We cannot jeopardize what we have, but we should be aiming at what is working right now.”
Cardenas has said the recognition for him, and Colombia’s receiving the award, has been a great opportunity to show off his country’s gaming sector and strengths of the region.
Colombia has been a pioneer in regulating online gaming. Officials said their experience will show countries like Brazil, Argentina, Peru and Chile how to create regulations for their markets. Currently, there are nine online licenses in the country; there could be as many as 20 by the end of 2018.
Colombia is primed for growth, with some 98 percent of the country connected to the Internet and 72 percent owning smart phones. Cardenas said those figures show that the country is betting on information and technology.
However, Colombia lags behind other nations in gambling spend at $107 per person per year. The figure is growing, with 50 percent of the nation being gamblers, he said. For illustration, Mexico’s gambling spend per person is $210, Peru is at $162, Panama is at $144 and Argentina’s is $140. The average annual U.S. gambling spend is $590, well below Australia and Asia.
Colombia also must overcome illegal gambling operators who tarnish the industry’s reputation, Cardenas said. Illegal gambling cuts into government revenue that currently stands at more than $500 million a year and pays for health care, education, and other social services and helped to create about 500,000 jobs in the legal sector. He said roughly $350 million is being lost from illegal gaming.
Cardenas said promoting the industry and talking with media and government officials is important to show the impact the industry is making in all countries, including Colombia. However, he said, the industry can’t wait for government, but must be proactive and move faster than the state by creating partnerships and pioneering initiatives.
“I might be a dreamer, but I’m optimistic we can engage on the right pathway and change some of the bad impacts of the industry,” Cardenas said. “We have to improve the reputation of the industry and highlight good policy. We need access to banks (and) to reduce the tax burden. … We need to change the mindset behind how we can generate more wealth and jobs, how we can invest in our country, what we can do with that money.”
Market volatility, the price of oil, and the exchange rate have had some of the largest impacts on the Colombian economy, by increasing the prices businesses need to pay to replace equipment.
Colombia’s economy grew 1.8 percent in 2017 and is growing at a rate of 2.2 percent in 2018, Cardenas said. It’s expected to reach 3 percent-to-3.3 percent in the fourth quarter, which he called conservative. He would “love to see it beyond 4 percent.”
Inflation is running about 3.3 percent, down from a year ago, he said.
