Offshore Betting Threatens to Drain Africa of $11 Billion: PawaTech Advocates for Sensible Regulation at GSTA Conference
Vibe Check: Let's chat about the recent GSTA Summit in Nairobi, Kenya where a massive issue was highlighted: Africa might lose a whopping $11 billion in tax revenue to offshore betting platforms if they don't get their regulatory game on point.
Reason's Rant: Gabriel Opoku-Asare, Chief Public Affairs Officer at PawaTech, set the scene by painting a vivid picture of the impact of these revenue losses. Clinics unbuilt, schools unfunded, and delayed infrastructure – these are the personal consequences of unchecked offshore betting.
Playing Ball: The 5-day summit brought together bigwigs from all corners of the iGaming world, discussing ways to protect and grow Africa's regulated online gambling sector. Opoku-Asare's address stole the show, pinpointing the threat of unlicensed operators and proposed solutions.
The Big Leak: Opoku-Asare claimed that hundreds of millions of dollars are wagered annually through unlicensed offshore sites, causing a significant drain on local economies. By 2029, this leakage is set to reach an alarming $11 billion if no action is taken.
Channel This: Central to Opoku-Asare's message was the concept of channelization – the proportion of betting activity channelled through licensed, onshore operators. A high channelization means more tax revenue, safer gambling practices, and greater local investment. Low channelization opens the market to exploitation by unregulated offshore sites.
Tech Enforcement vs. Regulatory Policies: Opoku-Asare argued that tech-based enforcement like VPN or IP blocking isn't enough. Instead, regulatory and tax policies should make the legal market more appealing than the black market.
High Stakes, Low Returns: A major concern was the impact of excessive taxation on legal operators. Opoku-Asare explained how visible player taxes and deposit fees are driving users toward unlicensed platforms. For instance, a 1% tax on deposits can consume up to 10% of operator revenue, and a 4% fee may drain up to 40%, rendering legal operations unviable.
PawaTech's Commitment: Despite the challenges, PawaTech, a leading African iGaming technology provider, has contributed over $100 million in taxes across the continent and persevered in working within well-regulated markets.
H2's Take: Supporting the call for smarter regulation, research from H2 Gambling Capital forecasts the African iGaming industry could reach $22 billion by 2029, but only if 90% of betting activity is channelled through legal operators. H2's analysis warns that tax rates above 30% of Gross Gaming Revenue (GGR) make the market unprofitable and ineffective, incentivizing players to bet offshore. Instead, 15-25% is identified as the optimal tax band – maximizing both tax receipts and legal market participation.
Leading the Pack: Ghana was highlighted as a country paving the way for forward-thinking reform. The government has recently abolished its 10% withholding tax on player winnings and is planning to eliminate the 1% mobile money levy in 2025 – moves designed to boost channelization, support legal operators, and increase tax revenues.
Roadmap for Reform: Opoku-Asare presented a clear roadmap for policymakers across Africa:
- Tax Operators, Not Players – Remove visible customer-facing taxes.
- Tax Revenues, Not Transactions – Avoid taxes on stakes, deposits, or withdrawals.
- Prioritize Channelization – Structure tax rates to encourage legal betting activity.
PawaTechPawaTech, a leading African iGaming technology provider, is a strong advocate for regulated, sustainable gaming ecosystems on the continent. Powering over 7 million betPawa customers across 17 African countries, PawaTech is committed to transparency and local partnerships. Join our Telegram community to stay in the loop with GTSA 2025!
Sources:1. H2 Gambling Capital. (2025). iGaming Africa. Retrieved from [https://h2gc.com]2. GSTA Summit. (2025). Retrieved from [https://gstasummit.com]3. iSolutions. (2025). Retrieved from [https://isolutions.co.mw]4. GTSA 2025. (2025). Retrieved from [https://gstasummit.com]
- In the light of the dire financial implications for Africa due to unregulated online gambling, PawaTech, a leading African iGaming technology provider, proposes strengthening partnerships with regulatory bodies to establish smarter regulation for the industry.
- In his address at the GSTA Summit, Gabriel Opoku-Asare emphasized that technology-based solutions like VPN or IP blocking are inadequate, and technology should be employed to support regulatory policies that make legal, licensed betting platforms more attractive than their unregulated counterparts in the sports industry.
