Betting on South Africa, experiencing the safari type of gambling!

Saturday, 6 December 2014

-by Oana Mihalache

South Africa can be considered an emerging gambling market, experiencing growth in this area after a long period of oppressive laws. The category which has the largest contribution to the gambling generated revenues is represented by casinos, with around 80% of the total. South-African players have long passed the amateur stage, and they are now rather conservative, given the fact that their proclivity towards online gambling is still low, whereas traditional casinos are preferred.

Gambling in South Africa: scanning the figures

Despite the slow economic slowdown starting with 2012, the gambling industry resisted the pressure and even more surprising, the main category of the industry, casinos, generated incomes of R16.4 billion in 2012 (around $1.7 billion). The category with the fastest growth, though, was bingo, which rose by 86% in gross gambling revenues in 2012, following an expansion in many regions of the country. Another sector that has a strong growth is betting, climbing up by 19.3%, while the casino gross gambling rose 10.5%. Overall, gambling revenues increased by 13.4% in 2012, and the casino category generated around 80% of this growth.

The casino sector, in particular, had a constant increase since 2012, when it earned revenues of $1.7 billion. One year later, in 2013, this category earned $1.8 billion, and grew further in 2014, at $1.84 billion. Casinos gross revenue will continue its growth in 2015, when the authorities in the field expect revenues of no less than $1.93 billion.


Source: PwC Gambling Outlook 2013-2017

When it comes about spending, an adult in South Africa gives away more or less than R8,000 (575 euros) annualy for this “fun activity”. The numbers, though, show a small decrease of the ones engaging in gambling activities compared to recent years, despite the fact that the number of players increased by 20% in a decade, from 30% in 2001 to 50% in 2011.

There are 37 casinos with an operating license in South Africa, operating on a very well regulated and mature market. Experts forecast a moderate growth up until 2017, and revenues are expected to grow by 5%, up to R20.9 billion ($2.1 billion), according to PricewaterhouseCoopers (PwC).

The sector with the largest growth are casinos, despite their small number and the cartel on the market, with three main companies operating as a cartel on the market. Out of the 38 casinos operating in the country, 35 are owned by three companies – Tsogo Sun Group, Sun Internațional and Peermont Global Group.

The gambling industry development in South Africa, uncovered by law

Casinos began to flourish in South Africa in 1970, even though this type of activity was prohibited by law starting from 1965, when only horse races were permitted, regarded as a sports activity. A considerable sum of prohibition slightly led to a flourishing underground industry, with approximately 2,000 casinos operating illegally in 1995. Following the first democratic elections in the post-apartheid South Africa, held in 1994, all types of gambling were legalized and two years later, a national lottery was formed.

Online gambling had a slow evolution in the country, given the fact that is was constantly suppressed with restrictions. Online gambling activities were officially prohibited in 2004, but in 2008 an amendment to the initial law was published, trying to legalize this type of gambling and regulate this sector, long enough under pressure. This legalization attempt was soon suppressed by the casino operators and the authorities who wanted to avoid money laundering actions taking place online. In 2010, even online gambling offered on servers located outside the country were prohibited, and media channels were prohibited from promoting online gambling services.

Wind of change – online gambling, outside the law supervision

The first steps towards regulating online gambling were taken in 2014, the trade minister, Geordin Hill Lewis drafted a law that will be introduced in Parliament.

“Over the years, this industry has grown, South Africa has lost revenue, and the South-African public have not been afforded proper protection. The bill seeks to address these issues and also provides, we believe, protection to the player”, said a gaming lawyer for mybroadband magazine.

Nevertheless, gamblers in South Africa prefer land based casinos, regarded as more secure and with alternative options for betting. Also, these casinos are state regulated and are legally operated, thus players avoid risks and their winning amounts can be transferred in their bank accounts without any legal problems. Online gambling is still growing trend in the country, and the fast winning opportunities are attractive for players, despite risks and the lack of credibility.

Unlike other similar markets, like India, where legislative issues are similar to those in South Africa, the online gambling market is still appealing to online operators. Second only to Australian players, the ones in South Africa are among the most valuable in the world for online gambling. Even though players have limited options for using their credit cards and bank accounts for funding their gaming activities, they can make transactions using MoneyBookers and NETeller for making deposits in the online casinos accounts.

Land based casinos, a main attraction for South Africans

One of the most popular casinos in South Africa is Sun City Complex, located in the North West province of South Africa, famous for its gulf course, games diversity and outside gambling activities. Different, yet equally attractive, are some more complex casinos in Johannesburg, the biggest city in the country, such as Gold Reef City, Montecasino and Emperora’s Palace. There have a more urban style and have many opportunities for nightlife activities. A really unique attraction for gambling addicts, though, is Grand West Casino, located in the capital city, Cape Town, a rather refined and stylish location.

Sun City Complex is among the most renowned gambling destinations in the world, famous for the exotic mix of games and for the gulf course that attracts tourists from all over the world. At a 200 km distance for Johannesburg and Pretoria, the complex proudly shows off the African culture and offers countless gambling opportunities.

The biggest, though, is Grand West Casino, opened in 1997, with a plethora of games, ranging from 68 table games, 10 poker tables and no less than 2,524 slots and video poker machines. The casinos offers of 120.000 square feet of gaming space and is opened 24/7 for players.

Author: Editor

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