According to incomplete statistics, the total number of Chinese expatriates in Africa has exceeded one million, a significant portion of whom are young and middle-aged male laborers. These Chinese men are typically the main clientele of casinos. It is common to see gamblers squandering years of savings overnight at the gambling tables, with daily occurrences of Chinese expatriates going bankrupt overnight in African casinos.
As Chang Jiang and Yuan Qing stated: "Compared to Europeans, Americans, and Indians with similar or larger population bases, the proportion of gamblers among the Chinese is surprisingly high." However, disproportionately, there is very limited research on Chinese-operated casinos in Africa or Chinese gambling habits.
In anthropologist Yang Beibei's research, many Chinese immigrants in Zambia, especially those employed by small and medium-sized enterprises, have a habit of visiting casinos for entertainment and relaxation.
Another paper by historian Li Anshan records the origin of a gambling form called "Zi Hua": it is said that "Zi Hua" was initiated by early Chinese expatriates in South Africa and has been monopolized by the Chinese for over a hundred years. Early Chinese community centers occasionally collected profits from these Chinese casinos to fund education.
However, for a considerable period in the past, most casinos in Africa were operated by Europeans (such as the British, Greeks, Russians, etc.) or South Africans.
Aside from a few Chinese businessmen in countries like Mauritius and South Africa who ventured into the gambling industry earlier, Chinese capital entered the African gambling sector in significant volumes after 2000. This is directly related to China's "Going Out" strategy proposed at the turn of the century and the increasingly close economic ties between China and Africa since then.
According to a McKinsey report, there are now over 10,000 Chinese private enterprises in Africa, gradually becoming a major force in Sino-African economic and trade investment cooperation.
In recent years, a significant backdrop to the surge in the number of Chinese-operated casinos in Africa is the comprehensive anti-corruption campaign and crackdown on organized crime conducted across mainland China. As part of "yellow, gambling, and drugs," the gambling industry is often a major avenue for corrupt individuals and criminal forces to amass huge profits and is a key target of national crackdowns.
Some Fujianese businessmen involved in the gambling industry along the Fujian coast have chosen to relocate to Africa to seek new opportunities after being arrested or fined in the crackdown on organized crime.
Chinese casinos in Africa typically have two characteristics.
On one hand, they offer high-quality services, comparable to those in developed countries. To attract customers, Chinese casinos often provide free catering services, including Chinese meals, and invite performance groups to entertain.
Moreover, some casinos also target the Chinese expatriate community with various marketing strategies, such as advertising in Chinese newspapers or WeChat public accounts subscribed by many overseas Chinese, organizing regular social events, providing free shuttle services, and even having sex workers from China lingering in these casinos.
On the other hand, they tend to cluster, showing certain aggregation characteristics. In Kenya, at least seven Chinese-invested casinos are concentrated in the Hurlingham area of Nairobi; in Luanda, the capital of Angola, there were once more than five Chinese-invested casinos along Fidel Castro Avenue; in Ghana, where there is a higher concentration of gold, Chinese-invested casinos are also concentrated in the capital Accra and the port cities of Tema and Kumasi, which attract many Chinese gold prospectors.
This clustering also leads to intense competition among the casinos, including vicious competition that has led to bloodshed.
The economic pulse and investment fluctuations of China in Africa also largely determine the rise and fall of the gambling industry in Africa.
For example, in several mining cities in Ghana with a large Chinese population, around 2010, a series of "Chinatowns" emerged—complete with Chinese restaurants, hotels, supermarkets, KTVs, and the gambling industry was consequently boosted.
After 2013, as the Ghanaian government intensified its crackdown on illegal gold mining, many Chinese were deported or reluctantly returned to China, and many once bustling casinos subsequently closed down. In Angola, following the end of the civil war in 2002, a large number of Chinese expatriates and Chinese capital flooded in.
According to data from its Ministry of Interior, the number of Chinese expatriates in Angola reached a peak of 260,000 in 2012, accompanied by a surge in Chinese casinos. However, around 2015, due to the collapse of oil prices, Angola's economy suffered severely, leading to severe inflation, and the number of Chinese expatriates and their investment volume inevitably decreased, resulting in the gradual closure of many casinos.
According to media interviews and research in these two countries, as well as Zambia, Tanzania, and Kenya, some Chinese investors lack operational experience in their invested casinos, leading to poor management and frequent conflicts of interest among shareholders. For example, a Chinese casino in Angola was forced to close due to intense internal shareholder disputes and mutual reporting, which attracted government investigation and multi-departmental law enforcement.
Therefore, finding a local casino operator with a good reputation, extensive experience, and preferably already holding a gambling license (such as establishing a joint venture or participating in acquisitions) is often an ideal investment method.
Additionally, the cost of security for casinos is also very high. During the author's visits, operators of Chinese casinos in Ghana, Angola, Kenya, and Zambia all stated that security is a primary concern for both customers and the casinos. Scholars have also pointed out that during his first week in Kinshasa, Democratic Republic of the Congo, several robberies targeting Chinese gamblers occurred, which is discouraging.
Beyond the daily security expenses, Chinese casinos usually also need to maintain good relationships with local police stations, a gray area that also incurs significant corporate costs.
In addition to establishing large-scale offline casinos, Chinese-made "slot machines" are also ubiquitous in many African countries, even in village pubs far from cities.
Some Chinese in Africa rent out slot machines to African small shop owners and share profits with them, forming the simplest gambling profit model. According to the author's research in a village in Livingston, Zambia, at the end of 2014, the minimum bet for a slot machine was only 2 Kwacha (about $0.12), attracting a large number of teenagers daily, with profits accumulating over time, which is quite substantial.
Concerning the phenomenon of slot machines attracting young people to gambling addiction, local people have expressed corresponding concerns, which has also attracted the attention and criticism of some African domestic and international media. Some African governments have also accordingly increased their regulatory and rectification efforts.
For example, in March 2015, the Ndola City Council in Zambia confiscated 123 machines from five Chinese businesses suspected of operating without a license. In 2016, the Lusaka City Hall in Zambia announced that all gambling machines could only operate in legal casinos, otherwise local authorities would forcibly confiscate these machines. Angolan officials in interviews also mentioned that many gambling game devices produced in China were operating illegally in Angola without being registered with relevant departments, and Angolan authorities would strengthen supervision and politics.
Online Gambling
Online gambling shows a steady growth trend.
The reasons can generally be attributed to the following two points: first, the outbreak and global pandemic of COVID-19 catalyzed online gambling games, as governments regulated entertainment venues for prevention and control, gradually shifting from offline to online; second, in recent years, the rapid development of mobile internet and digital financial services in Africa, with the convenience of mobile money payments, has been gradually popularized in African countries. As of December 2021, the internet penetration rate in Africa was 43.1%.
In addition, in recent years, due to tightening domestic policies, the retreat of demographic dividends, and the shift of traffic to emerging mobile internet markets, Chinese internet companies and personnel going overseas to start businesses has become a new norm. Entrepreneurial projects involve self-media, smartphones, e-commerce, mobile games, and also online gambling.
The industry research institute Zhi Xiang Net previously reported that against the backdrop of strict control of online gambling in mainland China, more and more enterprises with Chinese capital backgrounds have begun to enter the African gambling industry, including listed companies, some of which can achieve nearly ten million dollars in monthly turnover. For example, Xi'an Yunrui Network Technology Co., Ltd. (hereinafter referred to as Xi'an Yunrui), known domestically for its Werewolf Kill game, has already ventured into online gambling in Africa, and NetEase's subsidiary Thunderfire Technology Co., Ltd. is Xi'an Yunrui's largest shareholder.
According to Zhi Xiang Net's report, the company launched the gambling product Bangbet in Africa, mainly targeting the markets of Kenya, Nigeria, and Uganda. In Kenya, just by registering an account with a local mobile number, one can participate in gambling games and sports betting, with a minimum bet of only 20 Kenyan shillings (about $0.18).
Additionally, according to public information, the company controlled by Chinese enterprise Kunlun Group, Opera browser, has also carried out a multi-dimensional layout in Africa through joint ventures and joint-stock companies, covering mobile payments, music, and gambling. Opera owns 50.1% of the shares of Powerbets, one of the largest gambling companies in Africa, and as a joint venture, Powerbets is currently licensed in 9 African markets and operates in 7 markets, providing platforms for local sports betting and simulated sports gambling services.
For Chinese enterprises operating online gambling in Africa, promotional costs and licenses are major expenses, with promotional costs being the largest daily expense. To attract local customers in Africa, Chinese enterprises usually need to invest significantly in advertising and marketing, such as advertising on Google and Facebook, with an average monthly expenditure of $100,000 to $200,000. According to interviews, although the price of licenses seems to be clearly marked, it usually costs 10 to 20 times the marked price to obtain them, which is closely related to the high corruption rates in African countries.
Therefore, besides directly applying for licenses, another common practice for Chinese capital to avoid "unjust expenses" and enter the African online gambling industry is to find local partners for joint ventures, allowing local companies to handle registration and license applications, or to cooperate with local companies that hold licenses and rent their licenses.
For African governments, implementing online gambling regulation faces challenges from the technical side. A researcher responsible for foreign direct investment at the Zambia Development Agency stated in an interview: "For companies operating online gambling in Zambia, the Zambian government lacks the means and technology to regulate. Our officials and government agencies are not familiar with the online gambling business, and relevant laws and regulations are not well-established.
Some of our partners have reported that some online gambling companies operating in Zambia are not registered in Zambia and do not pay taxes according to the law. These companies are likely to use part of their income for money laundering. But our current regulation of the gambling industry is more about regulating the placement of offline casinos and gambling machines, and we have not yet been able to develop corresponding systems or arrange personnel with the necessary technology to be responsible for regulation."
Lottery Business
In addition to offline casinos and online gambling, Chinese capital is also involved in the lottery business in Africa. Huacai Holdings Group, listed on the Main Board of the Hong Kong Stock Exchange (with Tencent, China's largest internet comprehensive service provider, becoming the second largest shareholder of Huacai Group in 2014), has established extensive business cooperation with Ghana, Sierra Leone, Kenya, and other countries, involving computer tickets, betting-type lotteries, video lotteries, and instant lotteries, providing comprehensive services including lottery technology, games, and operations. Additionally, some smaller private capitals from mainland China are also involved in similar businesses in other African countries.
How to regulate and professionalize the management of the lottery market is to some extent related to the administrative capacity of African countries and the business proficiency of local officials. According to interviews with people involved in the lottery business in Kenya, the Kenya Gambling Commission has a high level of professionalism, conducts long background checks on gambling enterprises, requires its shareholders to have professional experience, and demands that the lotteries and services provided meet international standards, even going so far as to conduct transnational research for this purpose.
Some African officials also proactively request overseas training (such as in Macau, China) in the gambling industry. For example, the Ministry of Finance of Angola once proposed to the Chinese Economic and Commercial Counselor's Office in Angola to learn about gambling industry management experience in Macau, hoping to bring the Angolan gambling industry on track through training.
In some African countries with relatively weak comprehensive national power, the government lacks the necessary experience to effectively regulate the lottery industry, leading to substandard situations in printing and distribution. For example, the management of lotteries in Madagascar is very chaotic, with operators of varying quality entering the market. Chinese lottery merchants once had a dispute with a Malagasy customer over the authenticity of a winning ticket, leading to a conflict that caused local residents to gather and eventually escalate into a riot.
