When the Macau Casino Owners look back at 2019, they would not be able to collect some good news. Well, the industry would have hoped for something better for the fourth quarter of 2019. But they have mixed news as of now. Chinese Premier Xi Jinping is coming to Macau from December 18 to December 20. Now, this would hamper the short term financial goals for the already struggling casino owners. However, the announcements or the policy changes can make a difference to the rest of the year for the Macau Casinos.
Credit Suisse Group Analyst Kenneth Fong, Lok Kan Chan and Rebecca Law have predicted that the drop in GGR for the last quarter of 2019 could be around 15% to 20%. However, the question arises why the drop?
China generally controls the Visa from the mainland to Macau whenever the Premier is expected to visit. However, this time, visa control has started well before the expected date. The Chinese authorities mostly target those people who are repeat visitors and those are probably the most valuable for the casinos. Now, the visa control has started in November and would most likely cease on December 20. This has made an impact on GGR because the premium mass and the VIP members have significantly reduced in Macau. However, the experts also believe that the last few days of December would be able to normalize the situation. The situation could be even more stabilized in the first quarter of 2020.
However, everything is not bad for Macau as of now. There are plenty of announcements expected in Macau by Chinese President Xi Jinping reported the Calvinayre. There are two announcements that are most anticipated. The first is that the Chinese Government is expected to turn the Macau region as a financial hub. A nearby island of Hengqin is expected to be the new financial hub and would be used for the non-gaming expansion. The renminbi-denominated stock exchange is also expected to be built there. This could be a major boost for Macau as a whole.
These announcements can really make things change for Macau. The prime reason is behind it is the economy of Macau will have a major boost.
The analysts explained that the focus of the authorities would be on Financial Industry and Tourism. Well, both of these are not directly related to gaming operations. However, these two can be a support system for a long-term and sustainable economy. This would obviously reflect in the casino and gaming operations as well. If the tourism grows in Macau, the Casino, Gaming, and Hospitality are going to get the desired boost.
But as said, this isn’t going to satisfy any short-term desire for the industry. It can be said that Macau can hope for better days in the coming years. However, this could bring a positive sentiment in the industry and more investments can be expected. If China looks to develop Macau, that could be the news for the investors.
The Macau industry suffered in 2019 and 2020 does not really look bright either. However, with the overall development and growth of the economy, Macau may turnaround in the coming years.