Total gross gaming revenue for Macau casinos fell in October to its lowest monthly total so far this year. [Image: Shutterstock.com]
Impact of COVID-19 measures
Macau’s monthly gross gaming revenue hit a record low for 2021 in October as the region continued to deal with the impact of COVID-19 restrictions. Gross gaming revenue fell almost 29% month-on-month to around MOP4.37bn ($544.7m).
a 40% year-on-year drop in October revenue
Figures released by the Macau Gaming Inspection and Coordination Bureau on Monday show a 40% year-on-year drop in October revenue. That also represents a dip of 83% from pre-pandemic figures in October 2019.
On September 25, the Special Administrative Region (SAR) went into a “state of immediate prevention” in order to battle rising COVID-19 cases. Tourism levels took a hit throughout October as a result of enhanced restrictions on travel. The local government eased its COVID-19 alert level on October 15.
A sharp drop in visitor numbers
The number of tourists who arrived in Macau from mainland China fell last month. This majorly contributed to the drop in gaming revenue, with China typically representing the main source of visitors to the gambling hub. Macau’s neighboring Chinese city of Zhuhai brought in a 14-day quarantine period at the end of September for anyone entering from the SAR. Officials eased this measure on October 19.
Usually, the seven-day holiday period at the start of October is a fruitful time for Macau casinos due to an influx of Chinese tourists. However, the average daily number of visitors during the Golden Week holiday fell almost 94% year-on-year in 2021.
China has three separate Golden Week holidays. The National Day Golden Week usually starts on October 1 and commemorates the beginning of the People’s Republic of China in 1949.
Some good news for Macau
Despite October’s disappointing results, the situation is starting to improve in Macau once more. On October 26, 28,299 visitors arrived in the SAR, representing the highest daily total since the end of September. The average daily number of tourist arrivals surpassed 25,000 from October 20 until October 28, according to Macao Government Tourist Office figures. Casinos have also brought in strict testing measures and proof of vaccination requirements for their staff.
However, with COVID-19 cases rising across the mainland, there is a level of uncertainty for the near-term tourism outlook. Hong Kong is the second biggest contributor of visitor numbers to Macau. While people arriving in Hong Kong from the gambling hub are exempt from quarantining, there is still a quarantine requirement in place for people entering Macau from Hong Kong.
Mainland China is the only region to have a relatively quarantine-free travel agreement with Macau.
Ups and downs for casinos
As a whole, Macau casinos have performed better in 2021 than last year. In 2020, casinos had to deal with long-lasting travel restrictions which led to visitor numbers plummeting. For the first ten months of 2021, the total casino gross gaming revenue has reached MOP72.15bn ($8.94bn). This is around 57% greater than the total for the same period in 2020.
concerns that casinos will face much tighter controls
There is still a level of uncertainty surrounding Macau’s future, however. A proposal from the government in September aims to review existing gambling laws. This has led to concerns that casinos will face much tighter controls when it comes to their profit distribution and overall operations. The 45-day consultation period, in which the public and the industry could submit their suggestions regarding potential rule changes, came to an end on Friday.
The government will produce a plan for its reform after assessing the various suggestions, but it has not provided a time frame for the process. Officials have affirmed that any enhanced monitoring of casinos will not get in the way of business operations.