Asia’s gambling sector is beginning to feel the strain of tensions in the Middle East after the rising cost of living and falling tourism have led to declining gambling revenues across the Philippines.
According to the Philippine Amusement and Gaming Corporation (PAGCOR) Chair and Chief Executive Officer Alejandro Tengco, the beginning of the year got off to a rocky start as the conflict between the US, Israel and Iran continues to create greater inflationary pressure and dampen consumer spending power.
iGaming loses momentum in 2026
PAGCOR recorded overall revenue of P104.12bn (£1.26bn) through the first quarter of 2026, down 15.87% compared to the same period in 2025. This decline was largely driven by a 22.43% (£483.7m) year-over-year decrease in revenue from the e-games sector to P39.9bn.
The Philippines’ iGaming sector has long been a shining light for the country, growing 30% in 2025 despite the land-based gaming experiencing economic headwinds.
Tengco said: “We attribute the first quarter dip to several factors, including softer discretionary spending amid geopolitical tensions in the Middle East, and rising inflationary pressures.”
In 2025, the increasing appetite for iGaming was evidenced by the fact that the sector was responsible for over half of all gaming revenue. However, this has not been the case in 2026 so far.
PAGCOR-licensed casinos contributed 50.83% of total revenue in Q1 compared to e-games, which only provided 45.55%. PAGCOR-operated casinos provided the final 3.62%.
A global effort to offset macroeconomic pressures
Tengco previously called for closer collaboration between global gambling regulators to overcome the challenges caused by the conflict in the Middle East, which has caused oil prices to soar amid ongoing supply issues.
“This is not a good time for everyone,” he said, speaking at the Manila After Dark conference in April. “Gaming jurisdictions globally are feeling the impact of the oil crisis, and even more progressive countries like Singapore, Macau, and the United States are not spared.”
“It is important that we come together, that we continue these conversations, and that we support each other as an industry.”
Concerns over the impact on Asia’s gaming sector will only be exacerbated after talks between the US and Iran appear to have stalled over the terms of a peace deal.
Despite a lack of clarity on the timeline for peace, Tengco reassured stakeholders that he is optimistic for the future of the Philippines’ gaming industry.
“We remain hopeful that once the geopolitical tensions stabilise, consumer confidence and discretionary spending will also gradually recover, which should help support improved industry performance,” he added.
Earlier this month, PAGCOR remitted P5.67bn to the government under the Dividends Law, which requires all government-controlled bodies to remit at least half of their annual net earnings to the state.
Tengco said that the ‘much-needed’ funds would allow the government to ‘mitigate the effects of the global oil crisis and pursue programmes geared toward meaningful economic and social transformation’.
