The Macau government wants to impose a limit to the number of mainland tourists that visit the city, Secretary for Social Affairs and Culture Alexis Tam Chon Weng announced.
Mr Tam said tourists already swamp some areas of the city, which has a negative impact on the population’s daily life.
The announcement came on the heels of the overcrowding faced at Macau’s borders and main tourist spots during the Lunar New Year festive season, which started on February 19.
Mr Tam told reporters that the Macau government plans to soon discuss the issue with mainland’s central government. He said no cap had yet been decided and that limits could vary for different seasons of the year. Mr Tam added he hoped the cap could be introduced still this year.
Macau welcomed a record 31.5 million visitors last year. Visitors from mainland China accounted for over two thirds of the total.
The introduction of a cap to the number of mainland tourists coming to Macau is likely to pose increased challenges to the city’s gaming industry, as it will likely limit the potential for growth in the mass market.
Macau’s casinos have seen eight consecutive months of declines in gaming revenue since June last year, which analysts have blamed on a combination of supply side factors and demand side ones. They include tighter liquidity conditions for the credit-issuing junkets, a reduction in the number of transit visas available to high rollers and the crackdown on corruption in mainland China.
All Macau’s six casino operators are investing billions of U.S. dollars into new projects with a strong focus on the mass market. Macau’s two 2015 openings are Galaxy Entertainment Group Ltd’s Galaxy Macau Phase 2 and that for Melco Crown Entertainment Ltd’s majority-owned Studio City.
The call to introduce a cap to the number of mainland tourists is not new in Macau. But previously the government had argued that the city still had capacity to welcome more tourists – authorities just needed to better manage the inflow of tourists by directing visitors to less-visited parts of the city.
The first hint that something could be changing was provided in 2013, when the government’s Policy Research Office announced it would launch a study on the impact of the individual visit scheme in Macau. It said at the time that the goal was to help to develop the city into a more sustainable place to live and also a more welcoming destination to tourists.
The individual visit scheme allows mainland Chinese living in eligible areas of the mainland to apply for a travel permit to visit Macau individually instead of having to be part of a tour group. Last year, 9.6 million mainland tourists visited Macau under the individual visit scheme. They accounted for 45 percent of the overall mainland visitor arrivals to Macau in 2014.
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”China has been strengthening the control over capital flow, and the impact of that has already been reflected [on Macau’s gaming revenue trend]. There should not be any bigger impact from the new… legislation [on the mainland] … on the gaming revenue trend here”
Wilfred Wong Ying Wai
President of Macau casino operator Sands China