Inward direct investment – from outside investors – into Macau’s gaming sector fell to nearly MOP2.58 billion (US$320.1 million) in 2022, show official data published recently. That is a decline of 85.8 percent from the previous year, according to information from the city’s Statistics and Census Service.
The data indicated that the city’s gaming sector accounted for 8.8 percent of the aggregate flows of inward foreign direct investment in 2022, while banking took first place, with a share of 53.4 percent.
Last year, Macau recorded MOP29.24-billion in total inward direct investment, down 30.8 percent year-on-year; the result of “widened loss sustained by gaming enterprises,” stated the statistics bureau.
“This was attributed to the substantial increase in the capital of the enterprises for bidding the tender for concession agreement on operating games of chance in casinos,” it added.
As part of the public tender prior to the award of new 10-year concessions that began on January 1 this year, Macau’s six casino concessionaires had to increase their respective minimum share capital to MOP5.0 billion, from a previous MOP200-million threshold.
Macau’s casino operators recorded net losses and negative earnings before interest, taxation, depreciation and amortisation in 2022, due to travel restrictions linked to the Covid-19 pandemic.
A number of outside investors in Macau’s gaming sector in 2022 was registered either in Hong Kong, the British Virgin Islands or the Cayman Islands.
“Investment flows from the Cayman Islands turned from negative in the previous year to positive in 2022, attributable to the loans given to gaming enterprises by foreign direct investors,” according to the report.
What economists term “stock” of inward direct investment to Macau reached MOP367.31 billion by the end of last year, with gaming accounting for about 39.0 percent of the total.
