Uzbekistan Focus – Interview with Alessandro Fried
I have been told the Uzbek legislation is due to be published in June…what are you expecting?
The legalization of sports betting, which many experts have indicated will come into effect from 2021, is part of a movement that was set in motion by President Shavkat Mirziyoyev in regards to the country’s sport development, primarily football. In fact the decree signed by Mirziyoyev also approves a framework for the development of Uzbek football until 2030.
In terms of legizlation, keeping in mind that up until now all forms of gambling are considered to be illegal, many experts are of the opinion that the new regulatory framework will be particularly stringent also from an AML and Responsible Gaming perspective. This is based on the fact that one of the main reasons why the local authorities gradually made gambling illegal stemmed from a fear of gambling addiction problems and links to crime.
Do you think the country would consider expanding the legislation to also allow casinos?
Expanding the legislation to allow casino activity must not only be considered as an economic opportunity in terms of increased tax revenues, but a means of safeguarding the investments that will be made in the local iGaming industry, and the players themselves. A widespread regulation covering all the industry’s different verticals would ultimately assist the government in fighting the grey or black markets, with the players provided with a means to entertain themselves in a properly regulated scenario. A grey or black casino market would not guarantee players access to certified RNG games, which are a requisite to all strognly regulated markets.
So eventually I think that whilst the sports betting industry will be the first sector to benefit from this shift toward regularisation, eventually this will have a domino effect on all the industry’s verticals.
How much potential is there in Uzbekistan? Are people big gamblers? What is their spending power like?
Statistics from the World Bank national accounts data, and the OECD National Accounts data files indicate that in 2018 the GDP per capita in Uzbekistan was $1,532.4. This puts it on a par with other emerging realities. GDP growth was expected to grow by 5.5% for 2019 and the last two years have seen the government take concrete steps to transform its economy by liberalising its currency, lifting trade and investment barriers and reducing business regulations. Thus from an investment appeal point of view the local authorities are moving in the right direction.
The local industry would have good growth potential considering the year-on-year increments that has been registered in terms of internet and mobile penetration, which currently stands at 55% and 76% respectively. In fact recent statistics published by Hootesuite indicated a 7.1% increase in terms of internet users, and a 0.9% increase in mobile connections. The improving infrastructure is further underlined by the year-on-year change in the average speed of fixed internet connections (+122%).
What kind of product do you think would be most appealing to the market?
Sports betting is by far the largest sector in the global regulated betting market, with data compiled during 2019 by analysts from H2 Gambling Capital indicating that its share accounts to 67% of the total industry.
Consumer activity in Uzbekistan will undoubtedly reflect this tendency for sports betting predominance, and it is no wonder that local authorities have identified sports betting as the the first step in their regulatory efforts.
How do you view the potential of the CIS overall?
The CIS region has good potential in iGaming terms. We are talking about a population amounting to well over 200 million. The potential of the local industry is exemplified mainly in Russia, which has, in a few short years, gone from a closed market to one with a framework for online bookmaking. The true extent of this potential came to light with the World Cup which took place in 2018.
As the hosts of this sport event Russia admitted that its licensed bookmakers have seen an increase in sports betting. This was further underlined by a survey conducted by Russian online gambling affiliate Legalbet. The survey indicated that the traffic for one particular bookmaker, Parimatch, increased by 400% in the months preceding the kick-off to this main sporting event. Based on these figures it is easy to establish the huge potential of the local industry, and how this could well be indicative for the whole region.
Originally published by Asia Gaming Brief on June 12th 2020