Gaming industry remains key contributor to Maltese economy

The Malta Gaming Authority’s Annual Report published recently confirmed the substantial contribution that the industry gave to the local economy last year despite the unprecedented difficulties and challenges presented by the COVID-19 pandemic.

According to the report, the total Gross Value Added (GVA) generated by the gaming industry during 2020 stood at €924 million, representing around 8% of the economy. When the indirect effects are taken into account, the contribution of the industry to the economy value added increases to 10.2%.

In addition to this, at the end of 2020, the gaming industry directly generated almost 8,300 jobs in FTE terms, with 91.1% of these employees engaged in the online sector. This significant growth in employment within the online gaming sector during 2020 is a result of the planned investments and recruitment by a number of large firms which proceeded with their projects despite the COVID-19 pandemic. Add to this, the new companies that started operating in Malta in the same year.

The annual report shows that the total employment in the gaming sector in Malta during 2020 is estimated to be 12,398, approximately representing 4.7% of the total workforce. This includes employment generated by activities in or associated with the gaming industry, including FTEs who were working in Malta either on the activities licensed by another jurisdiction, with MGA-licensed firms, or providing direct services to MGA-licensed firms while being employed by another associated/related company.

The pandemic has accelerated the growth in technological innovations and has led the industry to explore new ways of distributing and delivering content to customers, such as through mobile and cloud-based gaming platforms. The local gaming industry is expected to continue to benefit from these trends, and to experience activity growth within its jurisdiction on the strength of its regulatory environment and its innovative outlook.

The total employment in the gaming sector in Malta during 2020 is estimated to be 12,398.

Although the industry has been and will continue to be affected by the pandemic, the MGA’s Annual Report claims that the gaming sector has also distinguished itself as one of the economic pillars that has been most resilient to the changes and challenges brought about by the pandemic. It states that the resilience of the sector can be attributed to its use of sophisticated digital systems together with the sector’s ability to adapt to changing circumstances. This was done by focusing on innovation and on particular products such as virtual sports, which replaced bets on live sport events.

Throughout 2020 the MGA continued pursuing its regulatory objectives and between January and December 2020, following information which emerged from compliance audits, compliance reviews, and formal investigations, the Authority issued 69 warnings, suspended 3 licences, and cancelled another 12. In addition, the MGA issued a total of 24 administrative penalties. In 2020, 30 compliance audits were conducted by the Compliance and AML function, and 324 desktop reviews were carried out, of which 98 identified deficiencies which were accordingly escalated to the Compliance and Enforcement Committee.

In 2020, 8 individuals and companies were deemed not to be up to the Authority’s probity standards by the Fit & Proper Committee, mainly on the basis of mitigating the risks of money laundering or funding of terrorism. During the twelve-month period of 2020, a total of 1,475 criminal probity screening checks were undertaken, an increase of 13.5% when compared to the year 2019. In terms of AML/CFT, during the sameperiod, a total of 27 supervisory examinations on online gaming licensees were conducted by the MGA on behalf of the FIAU, of which 10 were full scope examinations, 3 were targeted examinations, 8 were thematic examinations, and 6 were supervisory meetings.

The Commercial Communications Committee of the MGA took action against 10 adverts or promotions that, in the opinion of the Committee, inappropriately exploited the COVID-19 pandemic. During 2020 the Player Support Unit received a total of 5,625 requests for assistance, a 58% increase over 2019, potentially stemming at least partly from the impact of the COVID-19 pandemic on player behaviour.

The Maltese Government remains committed to ensuring that Malta continues to be an attractive place of primary establishment and that the gaming industry has the resources and capabilities it needs to remain resilient. During the year ahead, the MGA aims to consolidate its commitment to regulating the sector to ensure that the gaming sector remains fair, transparent, and secure against crime and corruption.

Speaking to TheJournal.mt, MGA CEO Dr Carl Brincat said that sustainable growth and regulatory compliance go hand in hand. “As a regulator we want to make sure that all our licensees are operating on a level playing field, in full cognizance of the fact that a robust compliance mindset and a focus on player protection is the way to ensure reputability of the industry and the jurisdiction alike, and to establish solid foundations for sustainable growth”, he said.

The gaming sector is expected to continue to play a fundamental role in Malta by directly generating employment and value added, attracting foreign investment and human capital, diversifying the economic base, and contributing to the growth of related activities. While the challenges associated with the COVID-19 pandemic as well as the evolving international regulatory requirements are expected to affect the future outlook of the gaming sector, on balance, the expectations for the gaming industry in Malta point towards continued growth.

Looking forward, the operators in the industry expect the situation to improve by 2022, such that there are more positive prospects for the performance of the sector.

 

0 0 votes
Article Rating
Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments

Menu