The Macau Gaming Inspection and Coordination Bureau posted information about the proceeds generated by the city’s 6 gambling operators in August. Revenue decreased 35.5% year-on-year to MOP18.6 billion. This was the fifteenth consecutive month when a drop in gaming revenue was posted in the world’s biggest gambling hub.
The posted results almost met gaming analysts’ expectations for a monthly decline of between 36% to 38%. It is also important to mention that the drop was steeper than the one reported for July. Back then, gaming revenue at the Chinese administrative region plunged 34.5% to MOP18.6 billion.
The financial results reported by the city’s 6 gambling operators and 36 casinos came shortly after Macau officials announced that GDP fell 26.4% during the three-month period ended June 2015. This was the third straight quarter that the administrative region posted a slump in its economy.
Government officials announced that all kinds of public sector expenditure would be subjected to stringent austerity measures. For instance, assets and services that are included in Macau’s annual budget may be frozen.
Analysts and other people with broader knowledge of the matter tend to ascribe the current state of affairs in the city, which is the only Chinese territory where casino gambling is permitted, to the anti-corruption campaign launched by China President Xi Jinping back in 2014.
As a result, Macau’s VIP segment was severely hit as the number of high rollers from Mainland China significantly dropped over the past year. This, in turn, led to the closure of high stakes parlors.
Recently, the Macau government revealed that the current smoking ban, under which mass market gambling customers cannot smoke within the casino floor, may be broadened to include VIP lounges as well. Some analysts believe that this would further worsen the current situation.
It is important to note that even with the long-standing downfall, Macau still generates five times the proceeds of Las Vegas’ casinos.
According to gambling experts, revenue at the Chinese administrative region will improve in this year’s second half as Melco Crown’s Studio City integrated resort is expected to open doors on October 27 and potentially draw the attention of well-to-do customers from Mainland China and the Asia-Pacific region as a whole.
