Sports and soccer betting banned in Uganda, hit or miss?

“As far as the President is concerned, the dilemma that young people are facing is choosing between hard work and betting, so much that removing one will inevitably work for the other.”

— Simiso Shabangu, FirstTouch Africa

When the President of Uganda, Yoweri Museveni tweeted that Uganda will be banning sports betting by not issuing new licenses for betting companies nor renewing old ones, he got a “Praise the Lord” from religious leaders and skepticism from economists. According to the President, there are a couple of justifications for this directive and we cannot dispute that. However, the effect of an action is not always as noble as the intention of it. Will this decision yield the anticipated results?

Why was it done?

The directive seemingly stemmed from the President’s best interest for the youth. According to him, sports betting is the reason why most people are diverted from the core value of hard work and lie around idle. As far as the President is concerned, the dilemma that young people are facing is choosing between hard work and betting, so much that removing one will inevitably work for the other. Such an incredible dichotomy of choices! Even more importantly, the President touched on how most of these companies are foreign owned. After all the betting that takes place, they take most of the profits outside of the country which drains the economy. This is a common phenomenon amongst African states and it really does need to be curbed.

Hit or Miss?  

Uganda supporters cheer ahead of the 2017 Africa Cup of Nations group D football match between Egypt and Uganda in Port-Gentil on January 21, 2017. / AFP / Justin TALLIS

(Jan. 20, 2017 - Source: AFP)

The government of Uganda is estimated to lose about Ush50 billion  (about U$13.6M) yearly from these companies if they go ahead with implementing this ban. This is probably way less than what these companies then take out of Uganda annually, but it sure does contribute to the welfare of some Ugandans. Should government then let go of it under a ban?  Mr Albert Baine, a tax expert from Global Taxation Services Ltd, said that in as much as government should care about the social impact of activities that happen inside the country, it should also ensure that does not come at a financial loss. This then proves that if the outcome is to satisfy both criteria, then a ban is probably not the best way to go about it. There is a way through which regulation could be crafted such that financial and social impact are maximised.

Betting is also one other way that adds excitement and commitment to sports, especially football. When people do not just associate a team with colours, but with their money, they are most likely going to attend the soccer matches or stream the game. They will be religiously following the team that they have sided with during a bet. This is the kind of support and attention that sports especially in Africa need. However, we agree that interest should not come at the expense of other things like academics and work. This then means that people need to be sensitised on the dangers of gambling addiction, which is something that companies can take up as part of their Corporate Social Responsibility (CSR).  Because a ban comes with a blanket wipe out, even of things that might be beneficial, like commitment to sports, it maybe a miss in some cases.

Mr Paul Lakuma, a researcher at the Economic Policy Research Centre also raised a point about how this ban could lead to the eruption of a gambling black market. If it is surely an addiction, people will not be stopped by legislation from practising it. Instead, they will find means to do it outside of the government’s eyes. This will even lead to a higher economic drain as government cannot account for this underground money and possibly lose tax from it.

Conclusion

What then shall I say, I am of the opinion that the President’s concerns are genuine and should be taken seriously. However, a ban seems to be quite a drastic approach. There are softer ways to deal with all the problems that he has rightly identified.