By: Dionisio Babo Soares
As Southeast Asia’s online gambling industry flourishes, reaching USD 3.48 billion in 2024, Timor-Leste finds itself at a critical juncture, contemplating whether to embrace its potential as an iGaming center. However, compelling evidence from global and regional studies reveals profound social, economic, and mental health risks, necessitating an immediate and total ban to protect the nation’s future. There are pros and cons in Timor-Leste regarding gambling and online gambling.
Drawing on cutting-edge academic theories and robust data, I recommend that Timor-Leste prioritize its citizens’ well-being over fleeting economic gains. It is also important to scrutinize the potential involvement of policymakers and leaders in gambling-related decisions to ensure that public interest drives policy, not private agendas.
The online gambling sector in Southeast Asia is expanding rapidly. In 2024, it generated USD 3,481.5 million in revenue, with forecasts projecting an increase to USD 5,513.9 million by 2033, reflecting a steady 5.24% annual growth rate from 2025 onward. Data compiled from various sources suggests that, combined with traditional gambling, regional revenues are expected to reach USD 14.54 billion in 2025, with user numbers climbing to 85.1 million by 2029. Timor-Leste has taken initial steps toward this industry, granting its first offshore gaming license in April 2025. According to some, the licensee promised over USD 100 million for local initiatives, including a Dili-based business process outsourcing center expected to create 120 jobs and train 100 operators. While these figures may appear promising, they obscure the significant dangers that accompany such growth, dangers that Timor-Leste’s limited infrastructure is unprepared to address.
The societal toll of online gambling provides a strong rationale for prohibition. Worldwide, about 2% of people meet the diagnostic criteria for gambling addiction, with 1–3% of internet users affected by online platforms. Research from the University of California, San Diego indicates a 23% increase in online searches for gambling addiction support following the legalization of sports betting in the United States, reflecting rising distress and demand for help. In the nearby Philippines, online betting revenue skyrocketed to PHP 410 billion in 2024, up from PHP 158 billion in 2023. However, as quoted elsewhere, this growth came at a cost: 12% of bettors were identified as “high-frequency risky borrowers,” and 36% as “break-even optimists” teetering on the edge of debt. These patterns signal potential harm for Timorese communities, threatening family stability and exacerbating poverty in a nation still developing its economic base.
Economically, online gambling poses severe risks to both individuals and the state. Regular online bettors lose money 80% of the time, with 15% facing significant financial distress and average debts exceeding USD 10,000 among those with addiction. In advanced economies, the annual cost of unaddressed gambling addiction reaches billions, driven by healthcare expenses, debt relief programs, and reduced productivity. For Timor-Leste, with its limited social safety nets and emerging financial inclusion efforts, a surge in gambling-related insolvency could be devastating. According to available data, household savings, already scarce, would be eroded, and public funds, stretched thin, would be redirected to manage the fallout. Behavioral economics highlights how gambling exploits cognitive distortions, such as overoptimism and the illusion of control, trapping individuals in cycles of financial ruin. A proactive ban would protect household wealth and prevent an unsustainable strain on public resources.
The mental health consequences of online gambling further underscore the need for a ban. Heavy online betting is closely linked to elevated rates of depression, anxiety, and suicidal thoughts, particularly among young adults aged 18–24, who are most drawn to digital gambling’s accessibility. The relapse rate for gambling addiction, ranging from 60% to 80%, illustrates the challenge of recovery once dependency takes root. Timor-Leste’s mental health system, with only 0.2 psychiatrists per 100,000 people, is woefully unequipped to handle a rise in problem gambling cases. The biopsychosocial model explains how online gambling’s constant availability amplifies its addictive potential by intertwining biological predispositions, psychological vulnerabilities, and societal pressures. Without adequate support systems, the nation risks a mental health crisis it cannot manage. Prohibiting online gambling would preempt this threat, safeguarding the psychological well-being of its people.
Southeast Asian nations provide clear examples of the benefits of restricting online gambling. Cambodia banned it in 2019 after recognizing its societal toll. Indonesia enforces a total prohibition, using aggressive site-blocking and legal action to ensure compliance. Laos restricts gambling to foreign visitors, protecting its citizens. Malaysia bans it under national and Islamic law, while Singapore limits online betting to the state-run Singapore Pools and blocks most external platforms. Thailand considers gambling illegal, though it is exploring regulated zones, and Vietnam allows only tightly controlled pilot programs. These policies reflect a shared understanding that the dangers of unregulated online gambling—addiction, crime, and economic disruption—far outweigh potential tax revenues. Timor-Leste should follow suit, using these regional models as evidence that a ban is practical and effective.
To counter this growing threat, Timor-Leste must implement a comprehensive strategy. First, it should legislate a blanket prohibition on all online gambling activities, including payment processing, to eliminate loopholes and deter operators. Technical measures are equally vital: internet providers and financial institutions must block gambling websites and transactions, following Indonesia’s example. Public awareness campaigns, delivered in Tetum, Portuguese, and other local languages, should educate communities about addiction risks and available resources, leveraging social learning theory to reshape attitudes. Training health workers, teachers, and community leaders to recognize and support at-risk individuals will strengthen grassroots responses. Finally, independent annual reviews should assess social, economic, and health impacts to ensure the ban’s effectiveness and guide future policy. These steps, grounded in evidence-based governance, vigorously defend against the gambling industry’s expansion.
Equally critical is the need to investigate the role of politicians and decision-makers in gambling-related policies. The decision to issue an offshore gaming license in 2025 raises questions about its motivations. Does a genuine desire for economic growth drive these policies, or do they reflect hidden interests? Political economy theories suggest that elites may prioritize personal benefits over public welfare in developing nations with limited oversight. The promise of USD 100 million in investments and 120 jobs could mask conflicts of interest or undue influence from gambling operators. A transparent investigation into decision-making, examining financial connections, lobbying efforts, or undisclosed incentives, would clarify whether leaders act in the nation’s best interest. Such scrutiny is essential to maintain public confidence and ensure gambling policies serve the common good, not private gain. This call for inquiry is a safeguard, not an accusation, to uphold democratic accountability.
Timor-Leste faces a defining moment. The rapid growth of Southeast Asia’s gambling market threatens addiction, financial devastation, and mental health crises that could unravel the nation’s social fabric. By enacting a comprehensive ban on online gambling, the government can protect family finances, preserve public health, and foster sustainable development centered on community well-being. The economic temptation of becoming an iGaming hub is to create jobs and investments, which pale against the long-term costs of inaction.
As cited above, regional evidence and academic insights chart a clear path: prohibition is a moral and practical necessity. Moreover, investigating the influence of policymakers thoroughly will ensure that this critical decision reflects the will of the people, not the interests of a select few. Timor-Leste has the chance to build a resilient and principled future, rejecting the deceptive allure of online gambling for the enduring benefit of its citizens.
This opinion is personal and does not represent the institution the author is affiliated with. Please note: Some of the information cited is obtained from online information.
