Gross gambling revenue (GGR) for casinos in South Africa grew during the latest fiscal year, which ended last March, by 3.5%. While this should be seen as a positive for the industry, an ongoing recession is suppressing further growth. This, coupled with insecurity over a regulatory framework of the gambling market, is resulting in an unexpected consequence – the growth of illegal gambling.

According to the Casino Association of South Africa (CASA), the challenges faced by gambling operators are causing the problem to worsen. It added that there would more than likely be declines in GGR due to the uncertainty and the encroachment of illegal gambling operators on the legal space. The fiscal year GGR of 3.5% was lower than the rate of inflation, resulting in a nominal GGR decrease of 1.8%. It was the first time revenue had fallen since gambling was legalized in 1997.

CASA indicates that it has paid 37% of GGR – $425.16 million – in taxes and levies to various government entities in the current fiscal year. It added that the amount made the government the largest recipient of revenue of the group’s member casinos.

A recent report by PriceWaterhouseCoopers (PwC), the South African gaming industry is expected to grow at a compounded rate of over 5% annually until 2021, when it will reach almost $2.43 billion. CASA is hopeful that the forecast is correct and asserts that its members are prepared to contribute to making South Africa better.