Ghana now has 31 approved sports betting providers. In just a few years, the number of permitted enterprises has grown from 12 to 31. Advertisements advertising one operator's company or another have become widespread - billboards and paraphernalia are everywhere.
Indeed, the gaming industry's time has arrived, and the government has taken a strong interest in it. Sports betting and the casino sector are the two most important participants in Ghana's gaming industry, albeit sports betting is far more popular and accessible to more Ghanaians. The government earned GHS450 million in taxes from the gambling business between 2019 and 2022. There is still a lot to be gathered.
The sports betting sub-industry has grown so popular that when the government enforced a 10% withholding tax on profits in August 2023, there was a significant player uprising. Although extensive advertising has contributed to the sub-industry's appeal, the sub-industry's massive popularity may be linked to rising interest in the numerous football leagues, particularly in Europe.
As a result, the sub-industry's business peaks during the major European soccer leagues, particularly the English Premier League and the European Union of European Football Associations (UEFA) Champions League.
Sports betting is becoming huge business, and it's not just for football fans. Today, there are economies at both the national and sub-national levels across the world where the gaming business has become a substantial provider to public sector revenue.
Las Vegas and New Jersey in the United States of America are common examples, as is Macau in China. Malta, Singapore, and Aruba have also grown in popularity as gambling locations. The government has gone to great lengths in all of these cities and nations to convert them become casinos and betting centres for players both domestic and international.
One cannot blame these economies for using the gaming business to increase income. Aside from direct earnings from the business, there are additional connections to the larger economy that auger well for economic development. According to the American Gaming Association, the gaming industry in the United States of America provides almost USD261 billion to the economy each year and employs 1.8 million people nationwide.
As a result, the industry has emerged as an essential area for economic diversification. Kenya, Uganda, Tanzania, and Nigeria, all of which are located on the African continent, currently have thriving gaming sectors. Apart from direct revenue from the sector, these African nations have experienced a considerable increase in advertising spend and financial inclusion as a result of the use of mobile money applications.
Ghana has not been left out of the benefits of the gaming sector. In fact, it has become a significant source of revenue for the Ghanaian government. As the country faces difficult economic times, the gaming business has emerged as one of the industries targeted by the government to boost income. The Income Tax (Amendment) Act, 2023 (Act 1094) was approved by Ghana's Parliament in April 2023. Act 1094, among other things, imposed a 20% gaming revenue tax. It also imposed a 10% tax on gambling sector winnings.
According to Ghana Revenue Authority sources, the government of Ghana hopes to generate GHS 1 billion in direct taxes from the gaming business each year. According to the Ghana Sports Betting Association (GHASBO), the gaming industry's advertising expenditure in Ghana is conservatively assessed at GHS 200 million per year. Indeed, telecommunications firms in Ghana get millions of cedis from the business as processing fees.
The gaming industry accounted for the majority of mobile money sign-ups in the country in 2019, therefore boosting the government's financial inclusion and digitalization objectives.
Sports betting operators have created a forum for many professionals in the sports business to obtain training and rediscover themselves in terms of corporate social responsibility. Sports betting operators have given training to assist retired players and sports staff in pursuing economic options following their active athletic careers in this way.
These efforts also aid in the discovery of new talent in Ghana's sports business. Within the previous five (5) years, sports betting businesses have offered headline sponsorship for at least eight (8) Ghana Premier League clubs. Sports betting has made a significant impact to the Ghanaian economy. According to GHASBO, one sports betting provider is sponsoring the entire Ghana Premier League for the second year in a row.
Despite the foregoing, the gaming industry has always been associated with shady characters, scammers, and, to put it frankly, crooks. As long as the world remains a dangerous place, any industry that serves as a conduit for illicit activity will undoubtedly suffer the wrath of authorities. Many governments throughout the world, including the United States, China, and India, have attempted to outright ban or severely limit the industry's existence in the past.
However, the more they sought to restrict it, the more innovative and smart methods the business found to thrive. With the advancement of technology, it is now nearly difficult to put a complete ban on betting anywhere in the globe. Governments rapidly recognized that suppressing the sector was pointless and altered their stance. The mentality shifted to one of cleansing the criminal business in order to maximize income from a well-regulated gaming industry.
This shift in perspective influenced regulatory reforms, which resulted in better rules to manage the gambling business. Better rules enabled governments to notice the enormous amount of transactions and money flowing across the value chain. Smart government officials then began to investigate how they might use the industry to raise funds and strengthen ties to other sectors of the economy. Today, the gaming sector is one of the most diverse drivers of economic development on a global scale.
As a result, practically everything on the earth has a gaming sector. Malta, with a population of 516,000, collected about USD 1 billion in income from its gaming business in 2020. The gambling sector accounts for around 8% of Malta's GDP. Online gaming is a substantial contributor to Malta's economy. Online gambling consumes over half of the country's foreign bandwidth. Cities such as Cairo, Egypt, Sydney, Australia, Manila, Philippines, Lima, Peru, and San Jose, Costa Rica have become attractive tourist destinations in part due to their gaming culture.
They have both depended significantly on the gaming sector for economic growth. On the African continent, revenue from the online gambling sector alone is expected to reach USD 1.6 billion in 2023, growing at a 9% annual pace. Kenya, Uganda, Tanzania, Nigeria, Rwanda, and South Africa have all witnessed considerable expansion in their gaming industries in recent years. Ivory Coast, Senegal, and the Republic of Benin are all expanding their gaming industries.
Individuals and groups who push for a total ban or severe limits on the gambling sector must reevaluate their attitude. However, one can understand their fears. Aside from the possibility of illegal activity in the gaming sector, there is also the moral concern.
Many of our countrymen believe that gambling is sinful. While this is correct, we cannot regulate morality. Any culture that has attempted to regulate morality has either failed or become profoundly dysfunctional.
In any event, whose moral code would be the guiding principle, and where would the line be drawn? Morality cannot be legislated because of modern constitutional safeguards and civil freedoms. In light of the economic benefits of the gaming business, Ghana must take a cautious and pragmatic approach to dealing with the sector.
In a fiercely competitive world, if Ghana is to accomplish the aim of "Ghana Beyond Aid," it must use all permissible ways to produce money and diversify the economy. The request for an outright ban or severe limits on the gambling sector is similar to what Ghana has done to Palm Wine, Akpeteshie, Pito, and other locally manufactured alcoholic beverages. Historically, the focus has been on the disadvantages, notably those who have overused these alcoholic beverages in order to demonize local beverages.
Detractors in other nations have contributed to the idea that drinking these indigenous beverages will bring you to an early death. Today, the Palm Wine taper, Akpeteshie brewer, and Pito brewer are among the most reviled and, in the words of Franz Fanon, "the Wretched of the Earth."
Palm Wine, Akpeteshie, and Pito, on the other hand, are the Moet, Johnnie Walkers, and Hennesseys of other countries. A short investigation into the origins of these foreign alcoholic beverages that have become the toast of many middle-class and upper-class Ghanaians reveals that they all began similarly to our Palm Wine, Akpeteshie, and Pito.
Those countries welcomed what they had and then contributed to their growth into multibillion-dollar international wine, whisky, and brandy businesses.
The gaming industry's breadth and reach have expanded dramatically. The industry has embraced technology in order to go online. The essential question is, what can the government do to improve industrial regulation? What can the government do to mitigate, if not eradicate, the industry's negatives while promoting its positives?
The gambling Act of 2016 (Act 721) established the fundamental principles for regulating the gambling business. The Gaming Commission of Ghana, led by Gary Nimako Marfo and Peter Mireku, has done remarkable work to expand on the previous administration's efforts to tighten the regulatory environment.
The Gaming Commission has managed to engage with operators and other stakeholders to develop the regulatory system under the leadership of Board Chairman Gary Nimako Marfo. Gary Nimako Marfo has managed to bring together gaming operators, the Ghana Revenue Authority, the Bank of Ghana's Financial Intelligence Center, and other stakeholders to enhance the regulatory framework.
The Gaming Commission has urged these organizations to view themselves as stakeholders and collaborators rather than adversaries and rivals. The Gaming Commission, in partnership with the Ghana Association of Sports Betting Operators, convened a Gaming Regulatory Conference in July 2023 for stakeholders to discuss best practices for regulating Ghana's gaming business. Officials from the Gaming Commission, gaming operators, the Ghana Revenue Authority, the Financial Intelligence Center, Ghana Police, District Assemblies, journalists, and a variety of other stakeholders attended the meeting. Despite the Gaming Commission's modest gains, there is still more work to be done.
Approximately 20% of transactions on sports betting companies' betting platforms are still done in cash. Cash, although being light and basic, allows for anonymous transactions. Despite constitutional rights for privacy and secrecy, the one thing authorities must avoid in the gambling sector is anonymity. It is an irrefutable reality that the betting sector has a high proclivity for illegal conduct.
Indeed, if players are merely betting for entertainment purposes, they should not be concerned about leaving an audit trail. After all, the right to privacy and secrecy does not exist in a vacuum. It is balanced by law enforcement's mission to keep everyone secure in an ever-changing world.
The spirit and content of the Anti-Money Laundering Act, 2020 (Act 1044) Know-Your-Customer (KYC) rules require that every player/punter be positively recognized.
Moving to a cashless ecosystem is thus the surest path to a non-anonymous industry. This will also help to give the provisions of the Anti-Money Laundering Act meaningful meaning when it comes to their application to the gambling business.
The delicate subject of underage gaming remains a major source of worry. Ten years ago, the sports betting sub-industry was mostly retail, with several sports betting shops dotting across cities. When youngsters hung out and attended betting shops, underage gambling could therefore be easily discovered.
In response to complaints about underage gambling, operators hired bouncers to do age verification before allowing admission into sports betting shops. The dynamics of underage gambling have shifted dramatically in recent years. Approximately 80% of the industry is now online.
0 Comments