Macau’s gaming revenue in December slipped for the third straight month, marking the worst annual decline since 2015 as the world’s largest gambling hub struggled to lure high rollers amid geopolitical tensions and an economic slowdown.
Gross gaming revenue was 22.84 billion patacas last month down 13.7 per cent from a year earlier, according to data released by the Gaming Inspection and Coordination Bureau (DICJ) on New Year’s Day.
Last month’s year-on-year decline was the steepest in 2019. Only four months last year generated year-on-year growth. Month-on- month, gaming revenue in December was down 0.17 per cent.
That was lower than the median analyst forecast of a 15 per cent fall. Full-year revenue, at 292.5 billion patacas, was down 3.4 per cent from 2018.
Macau’s monthly gaming revenue had kept year-on-year growth for 29 consecutive months since August 2016, a trend that ended in January last year when revenue dropped 5.0 per cent.
The latest numbers show continuing pain for casino operators. Arrivals in December were further crimped by President Xi Jinping’s visit to the city to celebrate the 20th anniversary of Macau’s return to the motherland. This meant tighter visitor permit policies, travel restrictions and enhanced border security.
According to analysts, last year was particularly challenging for the industry as it faced the US-China trade war uncertainty, a slowing mainland Chinese economy, escalating anti-government protests in Hong Kong and a crackdown on cross-border gaming that squeezed junkets and the VIP sector. Meanwhile, rival gaming hubs such as Vietnam are threatening to chip away at Macau’s dominance.
Analysts expect this year to be better for casino operators as new hotel supply and infrastructure improvements kick in. Xi, during his inspection visit last month, urged the local government to diversify the economy and carve out a wider role in the Greater Bay Area (GBA) and his signature Belt and Road Initiative (BRI).
The Bloomberg Intelligence index of Macau gaming operators rose 12 per cent in December as investor sentiment improved over signs of a Sino-US trade war truce and Beijing’s supportive stance toward the special administrative region. That compared to a 7 per cent gain in the benchmark Hang Seng index.
(Bloomberg, Xinhua, MPD)