Thailand’s recent move to legalize casinos as part of a broader push to attract tourists and bolster its export-driven economy has ignited a regional debate, with the Philippines’ gaming industry sounding the alarm over potential competition. The draft bill, cleared by Thailand’s Cabinet in January 2025, proposes the construction of casinos within designated “entertainment complexes,” a policy aimed at drawing international visitors. However, this development has raised concerns in Manila, where officials fear it could threaten the Philippines’ booming gaming sector.
The stakes are high for both nations. Thailand, already a popular destination for global tourists, is seeking to diversify its economic base amid challenges in traditional export sectors. Meanwhile, the Philippines’ gaming industry, under the oversight of the Philippine Amusement and Gaming Corporation (Pagcor), is projecting record revenues for 2025, with gross gaming revenue (GGR) expected to reach between P450 billion and P480 billion, up from P410.5 billion in 2024. The potential rivalry between these two South East Asian neighbours underscores the delicate balance of economic ambition and regional competition.
A Boost for Thai Tourism
Thailand’s proposed legislation marks a significant shift in policy for a country that has historically restricted most forms of gambling due to cultural and legal concerns. Under the draft bill, casinos would be integrated into larger entertainment complexes, a model likely inspired by successful implementations in places like Singapore and Macau. The government hopes this will not only attract high-spending tourists but also create jobs and stimulate local economies in designated areas. 
The timing of the bill aligns with Thailand’s broader economic strategy. With an economy heavily reliant on exports such as electronics and automotive parts, the country has faced headwinds from global supply chain disruptions and fluctuating demand. Tourism, already a key pillar of the economy, contributed significantly to pre-pandemic GDP, and the government is keen to recapture and exceed those figures. Legalizing casinos could provide a new revenue stream, particularly if it draws visitors from nearby markets like China, where gambling remains heavily restricted.
However, the policy is not without domestic contention. Critics argue that legalizing casinos could exacerbate social issues such as gambling addiction and inequality, particularly in regions where economic benefits may not be evenly distributed. Others question whether the influx of tourists will offset potential cultural erosion or increased crime often associated with gambling hubs. While the government has yet to release detailed regulatory frameworks, public debate is expected to intensify as the bill progresses through legislative channels.
Alarm Bells in Manila
Across the South China Sea, Thailand’s plans have sent ripples through the Philippines’ gaming industry, which has emerged as a significant economic driver in recent years. Alejandro Tengco, president and CEO of Pagcor, described the Thai proposal as a “big threat” to local operators, warning of fierce competition from a neighbour that already enjoys robust international tourist arrivals. “We are preparing the local industry for potential rivalry,” Tengco told reporters, outlining steps to strengthen the regulatory environment and attract more investments.
One of Pagcor’s key reforms includes “decoupling” its dual role as both a regulator and casino operator, a move aimed at creating a level playing field for private investors. Tengco emphasized the need for stringent rules and guidelines, stating, “I’m making sure that Pagcor has stringent rules and regulations, and good guidelines to show that we stand on our own.” Additionally, the regulator has reduced remittance rates for online gaming operators to encourage investment and bring illegal operators into the formal economy.
The Philippines’ gaming sector has seen remarkable growth, with GGR increasing by 24.81% in 2024. Online gaming, or e-games, has been a particular bright spot, with revenues soaring by 309.20% to P135.7 billion. Tengco predicts that e-games could soon match the revenue of traditional brick-and-mortar casinos within the next two to three years. However, licensed casinos remain the largest contributor to GGR, generating P201.8 billion in 2024 despite a slight decline of 2.72%.
The projected growth for 2025 hinges on the continued boom in online gaming, a sector that has proven resilient even amid global economic uncertainties. Yet, the spectre of competition from Thailand looms large. If the Thai legislation passes and casinos are established, industry analysts suggest that Manila’s gaming hubs, such as those in Entertainment City, could lose a share of regional tourists to Bangkok or other Thai destinations offering integrated entertainment options.
Regional Economic Implications
The emerging rivalry between Thailand and the Philippines highlights broader trends in South East Asia, where countries are increasingly competing for tourist dollars as a means of economic diversification. Nations like Vietnam and Cambodia have also expanded their gaming sectors in recent years, with Cambodia’s Sihanoukville becoming a hub for Chinese gamblers before facing regulatory crackdowns. Thailand’s entry into this space could further intensify competition, potentially reshaping tourist flows and investment patterns across the region.
For Thailand, the economic benefits of casino legalization remain speculative at this stage. If successful, the policy could generate significant revenue through taxes and licensing fees, while also creating thousands of jobs in hospitality, construction, and related sectors. However, there are risks. If not tightly regulated, casinos could fuel illicit activities or exacerbate social inequalities, as seen in other gambling hubs. Moreover, the environmental impact of large-scale entertainment complexes could strain local resources, particularly in tourist-heavy areas like Phuket or Pattaya.
For the Philippines, the challenge lies in maintaining its competitive edge. While Pagcor’s reforms aim to attract investment, the industry must also contend with internal issues, including the need to combat illegal gambling and ensure sustainable growth in the online sector. If Thailand’s casinos draw significant numbers of regional tourists, the Philippines could see a slowdown in GGR growth, particularly if high rollers shift their focus to new destinations.
A Conditional Outlook
The full impact of Thailand’s casino legalization remains uncertain, as the bill has yet to be finalized or implemented. If passed, it may position Thailand as a formidable player in the regional gaming market, potentially rivalling established hubs like Macau or Singapore. However, success is not guaranteed, and much depends on the regulatory framework, location of the entertainment complexes, and public acceptance. As of now, there is no confirmed timeline for the bill’s passage, and analysts caution that political or social opposition could delay or derail the initiative.
In the Philippines, Pagcor’s proactive measures may help mitigate some of the competitive pressures, particularly if reforms succeed in drawing new investments. The online gaming sector, in particular, offers a buffer, as its growth is less dependent on physical tourist arrivals. Nevertheless, the prospect of a new regional competitor underscores the need for strategic planning and adaptability.
Balancing Ambition and Risk
Thailand’s push to legalize casinos reflects a broader ambition to reinvent its tourism sector and diversify its economy, but it also carries risks that must be carefully managed. For the Philippines, the potential rivalry serves as a wake-up call to strengthen its gaming industry and address long-standing structural challenges. As both nations navigate this complex landscape, the outcome will likely influence economic policies and tourist dynamics across South East Asia for years to come.
The interplay between economic aspiration and regional competition is a reminder of the delicate balance governments must strike. While Thailand’s policy could herald a new era of growth, it may also spark unintended consequences, both domestically and abroad. For now, stakeholders in Bangkok and Manila are watching closely, aware that the stakes extend far beyond the gaming tables.
