Argentina
Te industry faces many obstacles, top of which is the adverse economic climate. Today, Argentina has one of the highest rates of inflation in the world after Venezuela and Zimbabwe and has been in recession since 2018. Inflation continues to soar under the newly elected left wing government of President Alberto Fernández.
Argentina recorded its biggest increase in prices last year since 1991, when the nation was recovering from hyperinflation. Consumer prices rose 53.8 per cent in 2019. In addition, there is increasing speculation that Argentina could default, as it did in 2001, leading to another financial collapse.
Te crisis has already affected revenues for many land-based operators, including Codere. In November, the company reported that operating revenue in Argentina in Q3 2019 decreased by €83.6m or 25.7 per cent compared to Q3 2018, due to the significant devaluation of the Peso (67.4 per cent). Gross win per slot per day in local currency grew 24.9 per cent (27.8 per cent including clients’ withholdings), well below year- on-year average inflation of 54.2 per cent.
In addition, a new government could bring with it an anti-gaming policy. Te newly elected head of nation's most-populous province, Governor Kicillof, has remained tight-lipped on the issue of casinos.
In February 2017, ex-Governor of the province of Buenos Aires María Eugenia Vidal announced that she would cut subsidies to horse racing tracks completely. For more than ten years, the province of Buenos Aires has subsidised the activity of racetracks along with different trade associations. While it has a long and illustrious history, horse racing will continue to lose millions and will also cost millions for the state as there is almost no chance of any kind of resurgence no mater how much money the government pours into it.
P140 NEWSWIRE / INTERACTIVE / MARKET DATA
However, during the recent election campaign he expressed his desire to support the horse race industry in Buenos Aires in order to guarantee jobs. Tis is a complete reversal of his predecessor’s policy.
In February 2017, ex Governor of the province of Buenos Aires María Eugenia Vidal announced that she would cut subsidies to horse racing tracks completely. For more than 10 years, the province of Buenos Aires has subsidised the activity of racetracks along with different trade associations. Unfortunately, while it has a long and illustrious history, horse racing will continue to lose millions and will also cost millions for the state, as there is almost no chance of any kind of resurgence, no mater how much money the government pours into it.
In addition, if online sports betting is allowed to go ahead this could have a negative impact on the land-based sector. Vidal had put the tender for online gambling licences on stand by while she sought re-election. A total of 14 companies are scheduled to
contend for the seven online gambling licenses for the province. International interest had been high with a number of well known international companies teaming up with local companies in order to make a bid.
However, Kicillof, a far left-wing (arguably socialist) economist, is yet to say if online gambling will still be permitted by licensed operators and made no mention of the pending licence process as he was sworn-in as the region's new governor.
In the long term, Kicillof could lean towards a more practical approach like others have before him. Vidal also said she was against an expansion of gambling in principle, but renewed and in many ways expanded land-based licences while governor. Whether Kicillof - arguably one of the most far left leaning governors in many years- will do the same, remains to be seen for now.
Meanwhile, in the capital, incumbent Horacio Antonio Rodríguez Laretta was re-elected, meaning that the online gaming licences process is likely to go ahead. Tis could affect revenues for the floating casinos in Puerto Madero and the casino under the racetrack in downtown Buenos Aires, all of which are doing a brisk trade. However, in November it was
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