Three years of decline in Macau
A campaign by the Chinese government to root out corruption and money laundering in Macau is scaring off some of its casinos’ biggest spenders, who are choosing to play in other jurisdictions including the Philippines, Australia and Las Vegas, according to Bloomberg News.
An influx of visitors from China is boosting business in Vegas, and casinos in other jurisdictions including Melbourne and the Philippines are also wooing the Chinese VIPs. Meanwhile, Macau has seen three straight months of declining gaming revenue.
“Since the scrutiny has intensified, gamblers are instead spending time away from Macau,” wrote Praveen Choudhary, an analyst at Morgan Stanley in Hong Kong. “Rich and famous gamblers are lying low and junkets have turned cautious in extending credit to worthy people.”
Casino revenues on the Las Vegas Strip, meanwhile, have jumped 3.7 percent to $3.7 billion, an increase driven mainly by a 14.4 percent spike in baccarat, a game popular among the Chinese. Robert Shore of Union Gaming Group said it was “an inverse correlation” to the action in Macau.
Revenue from high rollers in the Chinese city could continue to contract for six to nine months, said Choudhary. “The impact on Macau gaming lagged the decline of other industries like lodging, food and beverage, events, and luxury retail,” he said.
