China’s zero-Covid policy has prompted some gaming manufacturers and suppliers to withdraw from the once-dominant casino market of Macau.
According to Bloomberg News, suppliers of slot machines, baccarat tables and other casino equipment are looking for greener pastures in jurisdictions that, unlike Macau, have moved beyond strict Covid shutdowns. Another factor is Macau’s current gaming concession retender, as current concessionaires will not be buying until their new licenses are locked down.
One major provider, Light & Wonder, is relocating some of its staff to the Philippines, where it is opening a new office, according to the Strait Times.
Another unnamed Japanese equipment maker is also moving staff to the Philippines and Singapore, Bloomberg reported. “The unnamed company is relocating as many as 30 percent of its employees and has taken more than half of its inventory out of Macau due to supply chain challenges,” the news outlet reported. The choice isn’t surprising, in that the unnamed firm has seen its Macau revenues drop by about 90 percent.
Macau Gaming Equipment Manufacturers Association Chairman Jay Chun said he knows “at least four multinational casino suppliers” that are choosing to relocate. Those figures could grow with the Macau government’s amended gaming regulations, which include a cap of 12,000 gaming machines for new operators starting in January.
Add to all this Chinese President Xi Jinping’s crackdown on VIP gamblers as part of his campaign against money laundering and capital flight.
Data from Bloomberg Intelligence said Macau recovered about 18 percent of 2019 GGR levels in the first half of this year. The Philippines and Singapore, by contrast, regained 79 percent and 68 percent of pre-pandemic levels, respectively.
“The Philippine market has become a dominant market in Asia, and it makes sense for us to put more staff there,” said Ken Jolly, Light & Wonder’s vice president and managing director for Asia.
Official data show that Macau GGR reached nearly MOP28.86 billion (US$3.567 billion) in the first eight months of 2022, down 53.4 percent year on year.
