Love it or hate it, the gambling industry is making inroads on the African continent. If not closely monitored, however, it could bring with it a host of evils such as prostitution, money laundering and fraud — not to mention gambling addiction. These problems came under discussion in Malawi recently, when industry regulators from around the continent met to strengthen ties between them.
The meeting, held in the resort of Mangochi a few days ago, marked the second gathering of the Gaming Regulators’ Africa Forum (Graf). This organisation was launched in South Africa earlier this year to help independent regulators pool their experience in various fields — including crime related to gambling.
Chris Fismer, who chairs Graf and the National Gambling Board of South Africa (NGB), said regulation of gambling holds the key to thwarting related crimes, which he said are denting the image of the industry.
“When gambling is properly regulated, it is a crime-free industry which can add value to the economies of [a] region, and bail member states out of poverty,” he noted.
Fismer added that the popularity of gambling in the United States and Europe was bound to spill over into Africa — another reason to strengthen mechanisms for monitoring the industry. The advent of democracy in South Africa and economic liberalisation in the sub-region had also opened doors for the sector.
“In countries where there was no gambling, there are now one or two casinos,” he said. However, Graf has yet to compile statistics on the rate at which the industry is growing.
According to a study commissioned by the NGB and released in April this year, South Africa is the continent’s leading earner of gambling revenues.
The report, titled The Economic Impact of Legalised Gambling in South Africa, surveyed the industry for 2001 and 2002. It noted that gambling had proved popular in the country: two out of 10 adults had gambled in casinos since 2001, while more than 70% of adults had bought lottery tickets. This had generated about R8,9-billion in revenue, and almost 51 000 jobs.
According to the NCB, South Africa currently has more than 30 casinos in its nine provinces.
However, this popularity has been coupled with a growing awareness that gambling can prove addictive. Thibedi Majake, CEO of the NGB, said regulators have woken up to this problem and are trying to educate the public about the possible dangers of gambling. Research is being conducted on the matter and efforts are also being made to rehabilitate those who have succumbed.
He said South Africa’s National Responsible Gambling Programme is an initiative that could be attempted elsewhere in the region. This programme also deals with the responsible advertising of gambling.
As yet, the NGB does not have data on the extent to which crimes like prostitution and money-laundering are related to gambling. The South African Police Service was also unable to provide statistics on gambling-related crime. However, police spokesperson Mary Martins-Englebrecht said a desk had been established in the KwaZulu-Natal province to look into the matter there.
The efforts of regulators have not been well-received by all parties. John Kapito of the Consumers Association of Malawi said: “You can not correct an evil with another evil. In Malawi gambling is an economic evil because the majority of the people are poor. By legalising gambling, you’re perpetuating poverty.”
At present, Malawi’s gambling industry is in its infancy, with only two casinos having been licenced there.
According to the World Bank, about 65% of Malawi’s population lives below the poverty line of a dollar a day.
Khuze Kapeta, chairperson of Malawi Gaming Board, admits that gambling is an expensive form of entertainment. But he says that in the Malawian context, it is mainly pursued by expatriate whites, Chinese and Indians.
Delegates at the Graf meeting also discussed the problem of illegal gambling. At present, South Africa is also experiencing the highest amount of illicit gaming on the continent.
A report issued by the NGB in June this year says that since 2001, 4 339 illegal gambling machines have been destroyed — and thousands more confiscated.
Regulators from Kenya, Swaziland, Tanzania, Zambia and Zimbabwe also noted that corruption and bureaucracy are frustrating their efforts to crack down on illegal operators — and proposed that Graf join forces with the International Criminal Police Organisation, Interpol, to crack down on these individuals.
Tsepo Ntaopane, of the Swaziland Gaming Board of Control, says several operators who were flushed out of South Africa have been arrested and convicted while trying to set up a base in the Swazi capital, Mbabane. Swaziland currently operates three casinos.
“The problem is that operators always think they are ahead of us,” said Ntaopane, “We’re in a situation whereby a country can’t single-handedly crack down on illegal operators without help from the other. That’s when Graf should bite,” he added.
In addition, internet gambling has brought with a whole new set of challenges. Currently, South Africa is the only country in the region to have online casinos. Regulators say the phenomenon is difficult to track and control.
“We have no capacity to monitor internet gambling. That’s an area we’re looking into in addition to setting up an alert database where illegal operators and criminal activities can be recorded at regional level,” said Master Maliro, CEO of the Malawi Gaming Board.
Khuze Kapeta says that although governments were initially wary to legalise gambling, the prospect of boosting their economies through taxing the industry has brought them around.
“Legalised gambling is creating a lot of excitement among governments because of benefits such as taxes, employment and licence fees. Authorities are saying they would rather keep those benefits than have nothing,” he said.
Delegates to the Malawi meeting adopted a draft memorandum of understanding during this weekend’s talks. Among other things, it states that the grouping shall strive to keep gambling free from criminal activity, enhance regional economic development, eliminate negative perceptions about gaming regulators and protect consumers. — IPS