Ugandan Officials Say No More Licenses for Foreign Gaming Sites

Thursday, January 31st, 2019 | Written by April Bergman
Ugandan Officials Say No More Licenses for Foreign Gaming Sites

Ugandan Junior Finance Minister David Bahati, while attending an event for President Yoweri Museveni, said his country has a gambling problem and its officials will no longer license gaming companies. Mr. Bahati suggested Uganda’s gambling problem is part of a growing trend in East Africa.

Most Ugandans gamble using their mobile smartphones. Android sports betting on live in-play betting apps is wildly popular, right alongside mobile payment methods designed for Ugandans.

Especially among Ugandan males age 18 to 30, mobile gambling is a popular activity. Some 45% of young male Ugandans gamble regularly, most often on offshore operator’s websites. But that is part of the problem.

As a room of well-wishers looked on, David Bahati said, “Ugandan youth are trapped in a vicious cycle of betting, staking their little earnings while believing that they might win a jackpot. From now on, no new companies are going to be licensed.”

That was not the end of it. Bahati said that licensed gaming operators in the country will one day be unable to legally sign up players. The Finance Ministry official said, “Those which are already registered [will receive] no renewal of licences when they expire.”

Uganda’s President Backs David Bahati

Bahati is not the only one whose attitude towards gambling has changed. President Museveni has expressed similar views in the past months, though the 5-term Ugandan leader encouraged legal gambling over the past few years.

What Yoweri Museveni dislikes most is foreign gaming companies which repatriate Ugandan money into their own homelands’ economies. At least if Ugandan gaming companies were the main operators, much of the capital would be re-invested in Uganda’s economy.

Yoweri Museveni on Foreign Gambling Companies

In a Twitter thread started on January 24, Museveni said of foreign gambling companies, “All they do is accumulate money from Ugandans, then ship it out of the country.”

The Ugandan president added that his policy going forward was clear: “Looking at the way limited space will be given, only Ugandan companies will be allowed.”

For a president who has been in power since 1986, that is a definitive announcement on the near future of Uganda’s gambling policy. The 75-year old Museveni could remain in office for another decade or two, given the politics of the country.

2015 Ugandan Gambling Study

Part of the trouble with youth gambling in Uganda is the lack of opportunity for other forms of advancement. A 2015 study by the Economic Policy Research Centre (EPRC) which focused on the capital city of Kampala found that 45% of male Ugandans in the 18 to 30 age group engaged in gambling. That is 20% higher than the statistic for all Ugandan adults.

More troubling is the fact 73% of those polled said they gamble for “livelihood”. Ugandan youth by and large do not see gambling as a leisure activity or form of entertainment, but instead see it as a profession. They gamble to escape poverty.

Researchers around the globe have shown that people who wager for “a living” are much more prone to become addicted to gambling. They chase the elusive goal of hitting a big jackpot with an increasingly small bankroll. In a game with odds stacked against them, the risk of ruin is great.

EPRC Study on Kampala Gambling

The EPRC study found:

“Our survey results show that expenditure on gambling has had serious displacement effects on household expenditure, with funds being redirected from household necessities and savings to betting.

In addition, time from productive activities such as work or attending school has been lost to gambling, where addicts do not have control over the amount of time and/or money they spend here, resulting in adverse effects on the gambler, their households and community at large.

Worryingly, the poorest people spend more of their personal income on gambling compared to their richer counterparts.”

Uganda Changes Gambling Policy

The same report stated that the Ugandan gambling industry is neither well-regulated nor policed very well. The National Lotteries Board (NLB), Uganda’s gambling operator, tried at first to establish a legal framework for gambling, but officials have found that the industry has become a trap for under-30 Ugandans.

Having been burned by the businesses which were licensed to provide gaming, Uganda’s leaders now will erect barriers to mobile gaming operators. Whether the government can enforce a ban is another matter. For now, the clock is ticking on legal gambling for foreign operators.