GGRAsia – Macau govt to cut forecast of US$16bln casino GGR in 2022

Macau govt to cut forecast of US$16bln casino GGR in 2022

Jun 06, 2022 Newsdesk Latest News, Macau, Top of the deck

The Macau government is to reduce its 2022 gross gaming revenue (GGR) forecast for the city’s casino industry. The announcement was made on Monday by Macau’s Chief Executive Ho Iat Seng (pictured in file photo), while speaking to the press after a public event.

The current GGR forecast of MOP130 billion (US$16 billion) for full-year 2022 had been mentioned in November in the fiscal budget plan for this year. The amount was already under half the MOP292.5 billion Macau achieved in full-year 2019, prior to the advent of the pandemic.

The cut in the government’s GGR forecast took into consideration the “huge impact” in the city’s casino industry from travel restrictions related to several Covid-19 outbreaks in mainland China during the first half of the year, said Mr Ho.

The reduced GGR forecast would be announced as part of an amendment to Macau’s fiscal budget plan for 2022 in the second half of the year, he added.

Macau’s casino industry recorded GGR of MOP23.79 billion for the first five months of 2022, down 44.0 percent in year-on-year terms.

The city’s economic recovery from the impact of Covid-19 was being “pressured” by tightened issuance terms for travel visas by mainland Chinese authorities for Macau-bound visitors, Mr Ho said. But the Macau chief executive added he believed issuance terms for visas to travel to Macau would be eased once the pandemic situation in the mainland came under control.

Mainland China is the only place to have a largely-quarantine free travel arrangement with Macau. Only visitors from so-called high-risk places for Covid-19 infection in the mainland are required to undergo quarantine upon arrival to the city.

Macau ID holders that are returning from abroad, as well as travellers from either Hong Kong or Taiwan, are currently required to undergo a 14-day quarantine in designated facilities upon entering Macau. Macau remains closed to foreign tourists, except for those coming from Portugal.

In his Monday comments, Mr Ho admitted that Macau could ease some of its travel restrictions later this summer, if Covid-19 risk was considered “moderate”. The local authorities were assessing the results of a pilot scheme recently put in place in several mainland cities, under which foreign visitors from selected countries were entitled to enter those cities but had to undergo a 10-day quarantine in designated facilities, followed by 7 days of home quarantine.

Mr Ho said he also did “not rule out” Macau adopting a scheme of seven days in quarantine in designated facilities, followed by 7 days of home quarantine.

The Macau chief executive also briefly discussed the outlook for Macau’s so-called satellite casinos. The Macau authorities are currently working on new regulatory requirements for the sector. The chief executive said he understood “most” of Macau’s satellite casinos would “stay” in business, but he did not elaborate.

These venues piggyback on the respective licences of Macau concessionaires: 14 of the existing 18 satellite casinos use SJM Holdings Ltd’s licence; three are using Galaxy Entertainment Group Ltd rights; and one is utilising Melco Resorts and Entertainment Ltd’s licence.

The backer of one satellite casino – located inside the Grand Emperor Hotel and run under SJM Holdings’ licence – has already said it would cease casino business on June 26.

That is the expiry date of the current six Macau concessions, unless they are extended temporarily until December 31, as has been envisaged by the local authorities, so that Macau prepares for a new public tender process. The Macau government has already received extension requests from all six operators, but has yet to announce a decision on the matter.