Goodbye, POGOs

Pre-pandemic, Chinese grocery stores and a slew of Chinese restaurants mushroomed in several areas in Metro Manila.

At night in my neck of the woods, you could see all the rooms in five adjacent high-rises bustling with activity, with youthful Chinese crowding the lobbies. The buildings hosted Philippine Offshore Gaming Operators or POGOs.

Many of the foreigners couldn’t speak English, much less Filipino, or even the dialect of Tsinoys, Hokkien. The language of POGOs, which cater to mainland Chinese, is Mandarin.

Even the menus in the restaurants and the product signage in the grocery stores that catered to them were written in Chinese characters, including prices. Not all Tsinoys can read those characters.

Initially, even the signages for the establishments were only in Chinese characters, until the practice drew criticism from Filipinos.

No official receipts were ever given. When ordering in their largest dining compound in our area, I would be handed a piece of paper on which Chinese characters were written. If there was no OR, no taxes were paid.

As for job generation, the restaurants and grocery stores did employ Filipino staff, mainly to communicate with the locals. But the job requirement for POGO employment in its core business, obviously, is fluency in Mandarin. So Filipinos handled only support jobs such as clerical work, maintenance and janitorial services.

Throughout the day and night, the POGO workers could be seen going in groups to the Chinese restaurants, sometimes walking, and others transported in the POGOs’ vehicle of choice, the Toyota Alphard van.

A top Tsinoy POGO operator told us at the time that the average age of the employees was 25. They were all mostly single and under one-year contracts.

Apart from these youths, we often saw older Chinese with the body build and haircuts of soldiers. Some even wore military pants and boots when walking in the streets.

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There was one local sector that reaped benefits from the influx of non-resident aliens: real estate.

Pre-pandemic, there were numerous reports of private homes being rented out at up to 10 times the prevailing rates, with six months’ advance payment.

The demand for POGO workers’ accommodations was so high that top property developers quickly jumped in, buying up long-idle land around known POGO hubs and rapidly constructing condominium-type buildings.

Today in my part of town, those buildings are mostly vacant; construction in certain sites has stalled.

Among those who rented out their homes, however, the POGOs aren’t being missed. They reported similar complaints: for the high rent paid, their homes were packed with so many transient tenants who had to take turns sleeping in whatever space was available.

Pre-pandemic, the Chinese embassy posted on its website that “any form of gambling by Chinese citizens, including online gambling, gambling overseas, opening casinos overseas to attract citizens of China as primary customers, is illegal.”

The statement declared that Chinese have been illegally recruited to work in POGOs and subjected to “modern slavery,” with their passports confiscated by Philippine employers and their personal freedoms severely limited.

“They are confined to live and work in certain designated places and some of them have been subjected to extortion, physical abuse and torture as well as other ill-treatments,” the embassy said.

It cited “dozens of kidnappings and torture cases of Chinese citizens who gamble or work illegally” in Philippine gambling entities. “Some Chinese citizens were physically tortured, injured or even murdered,” it said.

On top of these, the statement said “hundreds of millions of Chinese Yuan” were flowing illegally out of China and into the Philippines annually, driven by gambling.

Beijing had also appealed to Cambodia to stop offshore gaming involving Chinese citizens, and Phnom Penh complied. This, however, was one issue where Rodrigo Duterte rejected an appeal from his bosom buddies the Chinese.

Informed of the estimated income earned by POGOs, the Duterte administration decided instead to raise taxes and fees on offshore gaming.

Instead of complying, however, most of the POGOs decided that the hassle from both the Philippine and Chinese governments was no longer worth the trouble. They packed up and left, leaving a sea of abandoned office spaces. A few went underground.

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The “pastillas” scheme in the Bureau of Immigration catered to POGO workers. Even during the pandemic lockdowns, there were reports of POGO employees engaging in ransom kidnapping, human and sexual trafficking, drug deals and murder.

POGOs have become magnets for Chinese crime rings. They don’t pay taxes, the jobs they generate are mainly for Chinese contractual workers, and the establishments they patronize are owned by Chinese who also don’t pay taxes, and don’t even provide English translations for their merchandise.

Beijing has been cracking down not only on offshore gaming, but also, according to the embassy statement, “on ‘underground banks’ and online payment platforms that provide a financial settlement for cross-border gambling and other crimes, and… domestic network operators and companies that provide technical support for such crimes.”

Where’s the benefit for the Philippines in retaining any so-called legitimate POGOs? The fact that there’s a debate on how much the country needs POGOs and the equally pernicious e-sabong shows the weakness of our economic foundations.

We are heavily reliant on imports for our food. Economic growth is anchored on consumption that is driven by remittances from over 10 million Filipinos who can’t find decent work in their own country, and the ever-growing ranks of workers in the Philippines’ largest employer, the government.

Those left behind by the 10 million, suffering from substandard education and a lack of opportunities, are forced to depend on political patronage for their survival. Tax-funded political dole-outs contribute to the consumer-driven economy.

Compared with our more competitive neighbors, we are struggling to attract the kind of investments that will generate decent and sustainable employment.

President Marcos has been saying that the Philippines is open for business. The Duterte administration kept saying the same thing for six years.

What we got were the POGOs, with measly returns for national coffers.

The new administration should reject suggestions to retain what’s left of the POGOs, and simply bid everyone good riddance.