Gaming industry in Macau will have to get used to living with less profits - Plataforma Media

Gaming industry in Macau will have to get used to living with less profits

jogo Macau

Gaming experts told Lusa that the gaming industry in Macau will have to get used to living with less profits, even in a future without the restrictions and impact caused by the Covid-19 pandemic.

The executive director of the company specializing in gambling 2NT8, Alidad Tash, estimated that casino profits have dropped to about half of what they were before the pandemic, but he noted that they will also face less risk.

“I think the casino business will continue to be profitable. Not as much as before, but still a healthy profit. And the good news for casinos is that they’ve spent billions of dollars building luxurious integrated resorts. In the future, they will not be spending as much on new infrastructure. So the risk is lower. Put another way, they will have less profit than before, but also with less risk,” he summarized.

Despite the disappearance of junkets (high-stakes gamblers), “Macao will continue to be the best destination for Chinese gamblers”, he maintained.

“This is because Macau is Chinese. They are not in a foreign land. The restaurants are authentic, the merchants speak Cantonese, as their mother tongue, and they can also speak Mandarin. This is not the case when Chinese players go to Korea, Philippines, Vietnam”, he explained, when asked about a possible bet by the gaming industry in other Asian countries.

However, Alidad Tash predicts that Chinese high rollers “will not be able to come as often”, faced with “greater difficulties in bringing large amounts of money to Macau or any other destination”.

The thing is, he reasoned, “the ‘junkets’ used to be one of the biggest enablers to illegally get money out of mainland China, because Beijing “limits how much money per citizen can leave its borders”.

In short, with junkets out of circulation, “high rollers will visit and play less often in Macau, and with less money per trip”.

Ben Lee, an analyst at the gaming consultancy IGAmix, underlined the impact of the disappearance of the VIP market due to a repression on the marketing directed at it and the outflow of capital, along with a new more restrictive policy on the issuing of visas by of Beijing, visible in the last year.

Facts that indicate that potential future returns “will be more challenging and less profitable”.

Even because, he explained, “the marketing and promotion costs destined to the mass segments always attracted low returns in relation to what was disbursed”.

Having said that, he stressed, Macau “has to move towards attracting tourists from jurisdictions other than China”, but in order to do so “more than mere words on the part of local authorities is needed”, stressing that “the lack of specialization is increasing as more and more foreign skills are being pushed out of Macau”.

Ben Lee regretted that this happens, especially when “it is now necessary to plan for the future” and when the gaming industry is experiencing its worst moment in Macau, since “it is likely” that gross revenues for July “will be even lower” than the previous minimum of 716 million patacas [87 million euros] in June 2020.”

Macau, the gambling capital of the world and the only place in China where casino gambling is legal, is experiencing the worst outbreak of Covid-19 since the beginning of the pandemic, which led the authorities to decree a state of immediate prevention and partial confinement. , which ordered the closure of the casinos for almost two weeks.

Concessionaires have been accumulating unprecedented losses since 2020 and the Government has been forced to resort to the extraordinary reserve to respond to the crisis, not least because about 80% of government revenues come from gambling taxes.

Three concessionaires operate in the territory, Sociedade de Jogos de Macau, founded by the magnate Stanley Ho, Galaxy, Wynn, and three sub-concessionaires, MGM, Venetian and Melco.

Este artigo está disponível em: Português

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