A Macau public administration professor believes that the ongoing suppression of gross gaming revenue in the SAR is not necessarily due to COVID-19 restrictions, but more closely related to mainland China’s anti-gambling measures .
Talk with Inside the Asian Game after the Gaming Inspection and Coordination Bureau (DICJ) reported a GGR of just MOP$2.19 billion (US$271 million) in August – the second lowest monthly figure of the year – Eilo YU Wing-yat said there were bigger forces at play than the pandemic.
“Of [China’s] point of view, the central government doesn’t want too many mainlanders to come to Macau or other places to play overseas,” he said.
“70% of visitors to Macau were mainland residents, but now only 10% [of those mainland visitors] are left. The pandemic is only accelerating the decline of the gambling industry, but the root cause is the mainland’s restrictions on offshore gambling.
Macau remained open to mainland China between January and the end of June, but the GGR for the first half of the year only reached MOP$26.3 billion, down 46.4% year-on-year. the other.
Perhaps in an effort to boost foreign visits, the Macau government this week allowed the entry of foreigners from 41 countries, but with a mandatory seven-day hotel quarantine measure still in place for all foreign arrivals. Eilo YU said that even if Macao resumes normal interaction with foreign countries next year, it will not return to 2019 GGR levels.
He pointed out that “Macau’s game industry, to develop foreign sources of customers, will not be able to do so in a short period of time, and even if permission is granted, GGR will not return to 2019 levels”.
In the new tender for the Macau gaming license, the government also added the condition of “foreign market development” to the tender, with bidders urged to introduce initiatives to attract customers. “foreign”, i.e. customers from outside greater China. The government said Macau’s gambling industry could no longer rely on “one source of tourists”.
The government has also estimated the game’s annual revenue at MOP$130 billion over the past two years. Will the government make such an estimate next year? Eilo Yu said, “I don’t have a crystal ball, so I can’t predict how much gaming revenue will be next year… but of the estimated $130 billion in gaming revenue, 40% (52 billion) will be included. in government gambling tax revenue, and together with other government revenue, total government revenue is expected to reach approximately MOP$70-90 billion.
Government recurrent expenditure, not including infrastructure projects and other non-recurring benefits, will be between MOP$60 billion and MOP$80 billion, so the gaming revenue budget of MOP$130 billion would maintain the fiscal policy of keep expenses within revenue limits.