Posted on: March 1, 2022, 07:01h.
Last updated on: March 1, 2022, 07:03h.
Macau casinos generated gross gaming revenue (GGR) of MOP7.76 billion (US$963.8 million) in February of 2022.
Last month was a strong performance for the casino hub that remains under China’s “zero COVID” policy. The draconian response to even the smallest of new COVID-19 detections has greatly limited Macau’s ability to recover economically from the most uncertain of pandemic times predominantly experienced in 2020.
February was a roughly 6% improvement on February 2021. More promising is that the February casino win represented a more than 22% premium on January 2022.
But to highlight how depressed Macau’s gaming industry remains, GGR in February of 2019 totaled approximately MOP25.3 billion (US$3.15 billion). Macau government officials desperately need the region’s casinos to return business, as gaming taxes accounted for around 80 cents of every tax dollar received prior to the pandemic.
Gaming analysts focused on the world’s richest gaming market believe mass play — aka the general public — has returned to nearly 50 percent of pre-COVID levels. Travel restrictions have been slowly easing across mainland China, as well as in its two Special Administrative Regions (SARs) — Macau and Hong Kong.
Mainlanders, Hongkongers, and Taiwanese can presently enter Macau so long as they have not traveled internationally within the past three weeks. Hongkongers and Taiwanese travelers must present a negative COVID-19 test conducted within the past 24 hours. People arriving in Macau from the Guangdong Province can present negative tests collected within the past 48 hours.
The entry easing — most critically being the doing away of mandatory quarantines and medical observations — has allowed a substantial component of the mass market to return. But the “zero COVID” understanding lingers.
The question is how sustainable this level of demand will be in coming months, given seemingly rising COVID-19 cases in the mainland, especially in Guangdong — which accounts for the majority of Macau’s visitors,” explained JPMorgan Asia Pacific analysts DS Kim, Amanda Cheng, and Livy Lyu.
VIPs Stay Away
China’s assault on VIP junket groups that facilitate travel for the mainland’s wealthiest gamblers to Macau’s luxurious five-star casino resorts has resulted in the industry segment essentially disappearing.
Macau analysts say VIP volume in February was just 5% of its pre-COVID levels. Of that estimated 5%, the JPMorgan team says nearly all of those players were “direct VIP” customers. Direct VIP refers to gamblers who work directly with the casinos on their own accords.
February can be one of the busier times in Macau, as the Chinese New Year is often celebrated during the month. The annual public holiday typically gives Chinese people a week off to travel and vacation across the mainland. Many China residents opt to venture to Macau.
Macau tourism officials counted a record 1.2 million entries during the Chinese New Year in 2019 that ran from February 4 through February 10. For the seven days of the holiday in February of 2022, the total visitor count was only 113,700 people. However, that mark is a 25.4% recovery on the Chinese New Year in 2021.