Greece Looks to Online Gambling to Aid Financial Struggles

Posted on: January 17, 2016, 01:14h. 

Last updated on: January 16, 2016, 01:39h.

Katie Barlowe Read More

Greece is looking to new industries and untapped markets to help reduce its debt crisis and adhere to stipulations set forth as part of the country’s bailout financing.

And now, after floating the idea of online gambling last year, the Greek government says it’s moving forward with legislation to license Internet casinos.

Deputy Prime Minister Tryfon Alexiadis suggested that the upcoming bill will call for iGaming licenses to be issued to qualified operators at a cost of €3 million ($3.3 million) and taxed at a minimum rate of at least $1 million annually.

In total, Greece estimates that bringing casinos online could generate supplementary revenues of up to $550 million each year.

Great Expectations

The economic forecasts and financial benefit of iGambling being circulated by Greek officials might seem a little too optimistic. To reach a half-billion dollars, not only will citizens need to participate en masse, but operators will also need to be enticed.

Alexiadis didn’t release details on how online gambling would be structured and whether it would allow international or at least European Union neighbors to participate.

With now under 11 million residents, which is smaller than the population of Ohio, a $3.3 million entry fee and guaranteed tax of at least $1 million in the first year might not have gaming companies eagerly running towards throwing their money in the pot.

That being said, the economic crisis in Greece has led to a gambling addiction epidemic. According to the Therapy Center for Dependent Individuals in Athens, the average age when an individual starts gambling is just 20, some five years younger than in 2010. Addicts seeking help have also increased five percent over the same time period.

Budget Bailout

Prime Minister Alexis Tsipras of the Syriza political party (also known as the Coalition of the Radical Left) reassumed office in September, less than a month after his resignation.

Tsipras has the seemingly impossible role of leading Greece out of bankruptcy. Thanks to the work of his former Finance Minister Yanis Varoufakis, a talented economist whose expertise is in game theory, Greece exited its six-year recession in 2014, but insurmountable debt remains and it continues to climb.

Varoufakis was able to negotiate bailout loans from the European Union, International Monetary Fund, and European Central Bank during his nearly six-month term overseeing the country’s finances.

Greece is in the midst of its “Third Economic Adjustment Program” from the three organizations. To date, the country has received some $260 billion in bailout money. Now the New Democracy (ND) party, the minority group in the Hellenic Parliament, is calling on more conservative principles to guide the economic recovery.

This week, the ND elected Kyriakos Mitsotakis as its leader. Mitsotakis comes from one of Greece’s most influential and powerful political families, his father Konstantinos having formerly served as the prime minister.

There are 75 members of the 300-seat Parliament who are part of the ND party, a drastic minority compared to the 144 seats occupied by Syriza politicians.

Mitsotakis plans to offer a “reliable alternative for the country’s governance” to “create rejuvenation and expansion” in the coming year.

Online gambling will likely play a small role in that anticipated comeback.