Macau turns to entertainment after a year of losses

Macau turns to entertainment after a year of losses

Tuesday, June 2, 2015
Fernando Chui Sai On is positive despite further losses in May

Macau has celebrated an unwanted anniversary after recording a 12th consecutive month of decline in its casino industry.

The Chinese region saw revenue slump 37 per cent year-on-year in May, another serious fall for what a gambling market estimated to be worth five times more than Las Vegas.

Macau therefore generated 20.35 billion patacas during the month - which is $2.55bn or €2.33bn - and is still some way ahead of the $897m generated in Nevada in April.

The problems began a year ago when China’s government began a crackdown on corruption, which scared off high-rolling gamblers and also the junket system which allowed people to travel and gamble in Macau before settling debts when they returned home.

In addition, fewer people are now coming to Macau, with visitor arrivals down 3.6 per cent in the first four months of 2015 compared to the same period last year thanks to tighter visa restrictions and a smoking ban in casinos.

However, Fernando Chui Sai On, Macau’s chief executive, believes the region still has a bright future.

“Many people have recently raised their concerns about the future of Macau’s economy," he said. "The gaming industry, one of the economic pillars of Macau, has entered a period of adjustment and consolidation.

“Of course, we need to be aware of the problems ahead and the most important thing is that we must have courage …considering civil society as a whole, the unemployment rate remains low, the financial situation remains stable and solid, and several large investment projects are on schedule. Macau was chosen as one of the world’s ‘10 Best Tourist Regions’ in 2015 by Lonely Planet.

“The overall development of Macau remains positive.”

It seems the Chinese government is keen to see a more convivial, low-stakes atmosphere in Macau, and the industry itself is taking note as it looks to Las Vegas’ focus on entertainment as well as the machines and tables.

Despite the continual fall over the last year, casino operator Galaxy Entertainment Group has announced that it is to open two new casino resorts, with Galaxy Macau Phase Two and Broadway Macau to feature a kids park, 3,000-seat theatre, river ride and gambling tables.

Another operator, Melco Crown Entertainment, also plans to diversify in entertainment and retail, with JD Clayton, president of its Studio City resort, telling news agency Reuters: “We have really focused our attention on things beyond gaming to reach out for a new group of people and tap into new revenue streams.” 
 

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