Overview on China's Legal Lottery Market
According to reports by China's Ministry of Finance, China's total lottery sales revenue has been enjoying rapid growth in recent years and reached a record high of 81.93 billion Yuan (US$10.5 billion) in 2006, an increased of 10.54 billion Yuan from 2005's RMB 71 billion (US $8.6 billion). Analysts predict that China's lottery market will reach RMB 200 billion (US$25 billion) in 2008. Every day about 229 million Yuan (US$29.5 million) of lottery tickets were sold in China in 2006 (excluding the eight days around the Chinese New Year holidays when lottery sales were suspended). Of the total, sales from China Welfare Lottery, the only national lottery approved by the Chinese government, hit 49.5 billion Yuan (US$6.2 billion) in 2006, up 20 percent from 2005. The sales of the Sports Lottery increased 2.1 billion Yuan to 32.3 billion Yuan (US$4.15 billion). In 2006, China raised 27.76 billion Yuan (US$3.57 billion) in public welfare funds from lottery sales, 12.3 percent more than in 2005. The ministry said the fund was equally shared by the central government and the local governments, which will be mainly used for social welfare, such as the development of public sports facilities, education and health care for the handicapped. A large part also went to the social security fund to fill its deficit. China launched its first lottery in June 1987. Lottery ticket sales are one of the major sources of funds for building community sports facilities and financing the country's social welfare programs. Other than the two government sponsored lotteries (Welfare Lottery and Sports Lottery), all other forms of gambling are illegal in mainland China. China's lottery market has expanded quickly over the last two decades but the China Welfare Lottery Management Center still describes the penetration of lottery in China as low. As in 2006, China's per capita lottery sale accounts for only 0.663 percent of the per capita net income, which is equivalent to only 1-2 percent of the world average.
China lottery experts projected that China's lottery market to grow by CAGR of 31% to US$34.5bn by 2010 to become the world's second-largest lottery market after the US, which turned over US$54.2bn in 2005. In per capita terms this would equate to US$26 for China's lottery, among the lowest in the world.
SOURCE: PacificNet, Inc.