Chui: Smoking Ban Has Not Hurt Macau

Macau’s Chief Executive Fernando Chui Sai On (l.) says a partial smoking ban in the city’s casinos has had no impact on gaming revenues. The local government is considering a full ban, which operators say will weaken an already struggling market.

Ho seeks “compromise”

Fernando Chui Sai On, Macau’s chief executive, says there is no direct link between a smoking ban in the city’s casinos and the dramatic drop in gaming revenues.

According to the Asia Gaming Brief, Chui told reporters the year-long decline, which has wrested billions in value from the world’s No. 1 gaming market, is unrelated to limitations on smoking, despite reports from other gaming jurisdictions that experienced at least a 20 percent decline after a smoking ban was imposed. The government now limits smoking to designated lounges on and off the casino floors, but a full ban may be in the offing.

Chui said Macau has financial reserves that could tide over the jurisdiction as gaming revenues continue to cascade. UBS expects June to be the 13th straight month of decline, with GGR estimated to drop up to 37 percent year-on-year.

An independent study recently released by Macau’s six casino operators indicates that about two-thirds of casino employees favor smoking lounges.But Kelvin Choi Kam Fu of the Macau Gaming Enterprises Staff Association says employees are being pressured to support the smoking rooms.He wants casinos to offer a “healthy working environment for gaming employees,” even though the smoking lounges are not staffed by casino employees.

MGM China Co-Chairwoman Pansy Ho Chui-king said the industry is searching for a compromise that is satisfactory to the government, casino workers and operators who fear a full ban will just deepen the decline. MGM China Holdings CEO Grant Bowie said smoking lounges for both high rollers and mass-market players would be a “very good compromise.”

“We clearly support the initiatives from the government in terms of protecting the health of the staff, he said in a Macau News report, “but from a gaming operator’s perspective we also represent the interest of our customers.”

Chui said the territorial government will submit its bill on a full smoking ban in casinos to the legislature later this month. The impact of the ban will be reviewed every three years, he said.

Secretary for Economy and Finance Lionel Leong said the government will formulate internal austerity measures if June gaming revenues fall to MOP15.7 billion ($US2 billion). Lionel told reporters that the government is already cutting costs to offset losses in the local economy.UBS analysts said that the VIP segment is “clearly still sequentially weakening, and mass segment is not showing enough signs of stabilization yet.”