El Salvador Turns to Canada for New Digital Lottery Products

Posted on: August 2, 2022, 07:27h. 

Last updated on: August 3, 2022, 04:26h.

El Salvador is looking to become the first to recognize bitcoin as legal tender in a new digital lottery agreement. To do so, it will rely on Canada’s assistance following the legislative measure’s approval last week.

El Salvador president Nayib Bukele
El Salvador’s President Nayib Bukele gives a public speech, above. The country is enhancing its digital footprint through a new lottery partnership with Canada. (Image: Financial Times)

The Legislative Assembly ratified the economic agreement last week with 64 votes n favor and four against.

The agreement states that the electronic lottery will be added to products offered by the National Lottery of Beneficence (LNB, for its Spanish acronym). El Salvador and Canada will begin to manage and promote economic cooperation and social development between countries.

The two countries initially signed the agreement this past February. However, the Assembly needed to sign off on it for the work to begin. The project has a term of 10 years, with the opportunity for renewal.

Agreement Details

The agreement also allows El Salvador to use funds for public health, education, and social assistance programs. The new lottery products will also provide financial support for lottery ticket sellers and encourage the development of municipalities’ infrastructures.

The agreement establishes that, of the total income that the National Lottery receives, 10% will be allocated to the municipalities to execute works for the benefit of the population. An equal percentage will benefit the lottery sellers. Public health, education, and social assistance projects will receive the rest.

As a bonus, according to the lottery announcement, El Salvador isn’t making any financial investment to launch the new initiative. Instead, the Canadian Commercial Cooperation (CCC) will incur the expense.

The CCC is a government-led entity the Parliament of Canada developed in 1946. Its charter includes the development of bilateral and multilateral trade agreements. In addition, it increases domestic access to international goods and services and vice versa.

Regional Economic Growth

The president of the LNB, Javier Milián, gave lawmakers a rundown on how the new lottery products work. He described the electronic lottery as the next step forward since consumers can buy tickets with specific numbers they choose.

Up to three draws per day are possible through the implementation of the electronic lottery. Milián also highlighted the benefits of the new lottery offering to local communities.

There is also a need to cater to a younger generation of consumers. This segment is more attracted to digital products while not ignoring the traditional lottery ticket markets. Milián pointed out that the electronic lottery is filling a market niche and creating new revenue streams to boost El Salvador’s economy.

In addition, CCC will open operations in El Salvador. This will generate more employment since the company will have to hire administrative staff and sales, operational, and commercial personnel. Despite the expense the operation will incur, Milián assured lawmakers that a minimum of 50% of the lottery sales will comprise the prizes.