2019 was a rough year for Macau, and a slow fall in VIP play was a reason for that. Considering that, it was expected that junket operations would continue to decline, dropping 5% to 95 total, according to Macau Business.
These new numbers come from the Gaming Inspection and Co-ordination Bureau (DICJ), which published the data in their Official Gazette. This new sum of 95 junkets drops from 100 at the end of 2018, which itself was a fall from 109 the year earlier.
This decline may hurt junket operators or Macau concessionaires; however, it does make someone look pretty clever. In February 2018, president of the Macau Association of Gaming and Entertainment Promoters, Kwok Chi Chung, foretold the junket sector would continue to fall, predicting the U.S.-China trade war, absence of smoking lounges, and a shift to mass market gaming would lessen junket revenues.
Most of those anticipations came true, as Macau fought hard in 2018 to build on its revenues. As reported by calvinayre.com, gaming revenue dropped 3.4% year over year as VIPs strived to get the credit needed to gamble, and a change to mass market players didn’t happen quick enough to continue solid growth. Although analysts hoped things would be better in 2020, the epidemic of the coronavirus has already taken a toll on tourism numbers, and hopes for growth.
However, that’s not the only reason why junket numbers are dropping. New regulations, created to keep junket operators ethical in how they raise funds, could stifle even more players out of the business. In October 2019, the DICJ began talking about these regulations; however, new rules haven’t been put in place yet, and no clear timeframe has been given when they might be.
As Macau keeps on facing all possible hurdles to growth, the decision to actively daunt junkets could extend the difficult times even longer. It may be a good thing to implement new regulations to discourage unethical behavior; however, it’s just one more hurdle for Macau’s businesses while everything else is going against them.
