Africa to Collect US$1.8 Billion From Casino Gambling
Gross casino gambling revenues in South Africa, Nigeria and Kenya are set to hit the US$1.8 billion mark in 2019, up from US$1.7 billion in 2014.
PricewaterhouseCoopers LLP (PwC), a multinational audit and tax services firm, in its fourth annual edition on the gaming industry entitled ‘Taking the odds: Gambling outlook for 2015 – 2019 (South Africa – Nigeria – Kenya)’, says gambling revenues improved in Africa in 2014 despite challenging and weakening economies.
Of the three countries included in the report with detailed forecasts and analysis, South Africa has the largest overall gambling market. In South Africa, gross casino gambling revenues totaled US$1.72 billion in 2014 compared with US$4.97 million in Nigeria and US$2.18 million in Kenya.
Pietro Calicchio, Gambling Industry Leader for PwC South Africa, says: “Overall, the South African gambling industry continues to remain a vibrant and exciting sector, but is facing significant challenges, in particular a slowing economic climate and changes in regulation. An issue of particular concern to the casino segment is that of illegal online gambling. In addition, certain casinos are also facing competition from other gambling facilities opening up in their catchment areas. We anticipate slower economic growth to lead to slower growth in gross casino gambling revenues in South Africa and Nigeria, while Kenya’s casinos will face increasing competition from legal online and mobile gambling.”
In Kenya, casino gambling revenues rose by 6.9% in 2014, down from the 11.2% increase in 2013 and the 24.2% compound annual increase between 2009 and 2011. It is believed that the imposition of a 20% withholding tax on gambling may have contributed to the slowdown. In addition, increasing competition from legal online gambling and from a new national lottery may also have contributed to the slowdown for the 13 licensed casinos.
Kenya, like Nigeria, has been troubled with terrorism, which has hurt the tourism industry. However, the country’s casinos do not rely on foreign tourism and have fared well. For the forecast period as a whole gross casino gambling revenue is projected to increase at a 7.5% compound annual rate, rising from US$20.1 million in 2014 to US$28.9 million in 2019.