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Macao’s GGR forecast to be revised after massive shortfall

Receipts just MOP 23.79 billion for first five months of the year, whereas government had predicted MOP 130 billion for whole of 2022.

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Receipts just MOP 23.79 billion for first five months of the year, whereas government had predicted MOP 130 billion for whole of 2022.

ARTICLE BY

PUBLISHED

READING TIME

Less than 1 minute Minutes

UPDATED: 22 Dec 2023, 4:39 am

The government will not come up with an “exact” figure in its revised forecast for Macao’s gross gaming revenue (GGR) for the remainder of the year, Secretary for Economy and Finance Lei Wai Nong has announced.

Despite much-worse-than-expected GGR results so far in 2022, the policy secretary said that the government expects the second half of this year to be a “golden period” for Macao’s tourism industry, as long as the overall Covid-19 situation in mainland China remains stable.

Lei was speaking after attending yesterday’s opening ceremony of the 4th Macao Integrated Tourism & Leisure Enterprise Vocational Skills Competition 2022 at MGM Cotai.

Chief Executive Ho Iat Seng said on Monday that the government will “surely” adjust its original forecast for this year’s GGR of MOP 130 billion as Macao’s gaming industry has been hard hit by the economic impact of local Covid-19 transmissions in various areas in mainland China over the past few months. Consequently, Ho said, the government will submit another 2022 budget amendment bill to the Legislative Assembly in the second half of this year.

Ho added that the amount of the revised GGR forecast will be assessed by Lei.

In the first five months of this year, Macao’s GGR was down by 44 per cent year-on-year to MOP 23.79 billion, which was equivalent to only 18.3 per cent of the government’s MOP 130 billion forecast. 

Lei noted that at the end of last year the government forecast Macao’s GGR to reach MOP 130 billion in 2022, but GGR in the first five months of this year “had a certain level of difference with the government’s estimates”.

Lei noted that after having a relatively good performance in the first two months, GGR in March started to be adversely impacted by “uncertainty resulting from changes in the overall Covid-19 situation in mainland China”.

Consequently, Lei said, the government expects to submit a 2022 budget amendment bill to the legislature in the second half of this year. The legislature passed the government’s first budget amendment bill for this year in April.

As long as the overall Covid-19 situation in mainland China becomes more stable, Lei said, the local government will intensify its campaign to expand the range of visitor sources, extend visitors’ length of stay in Macao, and attract them to visit Macao again.

Lei said that the government will not come up with an “exact” amount in its revised GGR forecast for the remainder of this year.

The policy secretary underlined that Macao’s economic performance is “closely related” to the number of visitors, adding that the government will make good use of various channels to attract more visitors as long as the Covid-19 situation in mainland China and other neighbouring regions remains stable.

In related news, Lei underlined that the government will not interfere in the satellite casinos’ commercial decision-making as to whether to wind up their operations. He added that in general the government wants the existing satellite casinos to continue to operate in order to maintain Macao’s economic “momentum” and help relieve its unemployment situation.

Lei underlined that whether certain satellite casinos continue to operate is their respective commercial decision, based on their assessments of the Covid-19 situation and its impact on the local economy, and has nothing to do with the government’s gaming industry amendment bill.

Various gaming industry observers have said they expect around seven of Macao’s 18 satellite casinos to close down this year. 

At the end of the first quarter, Macao had 42 casinos, four of which (all owned by SJM) had been suspended, according to the Gaming Inspection and Coordination Bureau. The figure comprises both casinos owned and run by Macao’s six gaming operators and the city’s 18 satellite casinos owned and run by third-party operators, which would account for 42.8 per cent of the total number of casinos listed by the bureau, The Macau Post Daily reported. 

 

UPDATED: 22 Dec 2023, 4:39 am

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