Authorities in mainland China’s Guangdong province are set to resume on August 26 the issuance of tourist visas to Macau, according to a Tuesday announcement. That includes visas for package tour trips and for independent travel under China’s Individual Visit Scheme, also known by its acronym IVS. The measure would then be reinstated for all mainland provinces from September 23, said China’s National Immigration Administration.
The authorities announced the timetable on Tuesday, but said the resumption of such visas was dependent on the coronavirus situation remaining stable in both the mainland and in Macau.
The reinstatement of tourist visas however will not apply to mainland Chinese residents that are living in places defined by the authorities as “mid risk” and “high risk” in terms of Covid-19 infections, or to those that have travelled to those places in the 14 days prior to their application for a tourist visa.
On Monday, the Macau government had announced that Zhuhai city – next door to Macau – would resume on Wednesday (August 12) the issuance of exit tourist visas to the casino hub.
The IVS programme, which allows mainlanders to travel independently to Macau and some other places, was suspended in late January, as part of Covid-19 containment measures, with tour group visas paused around the same time as the IVS ones. A return of IVS visas has been mentioned by industry insiders as a key element in Macau’s casino market recovery.
JP Morgan Securities (Asia Pacific) Ltd said in a Tuesday note: “This means the travel/border policy between mainland China and Macau will fully normalise by the end of September (i.e., before the all-important October Golden Week), which, in our view, is one of the … blue-sky scenarios that we and the market had hoped for.”
“Now, the only meaningful ‘unknown’ is timing of Hong Kong SAR border/quarantine easing…as demand from Hong Kong probably comprised approximately 10 percent of pre-Covid GGR [gross gaming revenue] per our rough estimates,” added the analysts.
The JP Morgan team also said it expected Macau’s GGR to decrease by “85 percent/70 percent in August/September”, assuming the demand from Macau’s neighbouring Zhuhai city and Guangdong province to “almost fully recover within weeks of visa resumption”.
Assuming there is no resurgence in the number of Covid-19 infection cases, Macau should see “strong GGR recovery” next month and in the fourth quarter, brokerage Sanford C. Bernstein Ltd wrote in a Tuesday memo. “Operators’ earnings before interest, taxation, depreciation and amortisation (EBITDA) levels are in the range of achieving revenue levels of approximately 35 percent to 40 percent of last year’s. Macau should be able to get to those levels by mid-autumn,” said the Sanford Bernstein team.
(Updated 5.42 pm, Aug 11)
