Analysts at Sanford C. Bernstein say Macau can expect long-term negative impact from Covid-19 travel restrictions.
According to an October 11 research note, analysts Vitaly Umansky, Louis Li and Kelsey Zhu estimate GGR for 2021 will reach about 31 percent of 2019’s numbers (MOP292.5 billion, or US$36.5 billion), with the mass market segment reaching 27 percent of 2019 levels and VIP at just 21 percent.
Next year will be better, the analysts say, with GGR at 59 percent of 2019, mass back up at 76 percent, but VIP still languishing at 31 percent of pre-Covid levels.
In 2023, GGR will go to 87 percent thanks to mass growing to 115 percent of 2019, constrained once again by VIP at 42 percent. Market-wide GGR will not exceed 2019 levels until 2025, Inside Asian Gaming reported.
“Macau’s September GGR dropped 73 percent from September 2019 and October will be worse due to the recent Covid outbreaks in Macau,” they write. “Starting from September 25, the new local Covid cases have caused Macau’s temporary border closure with Mainland China, which significantly disrupted the visitation and GGR in late September and more importantly, October’s Golden Week.”
Golden Week was “completely ruined” due to the border closures, they said, and expect October GGR to be down nearly 80 percent compared to 2019.
“At this point, we expect GGR improvement in November/December, but do not expect the opening up of Hong Kong or easing of China visas until next spring and summer.
“Longer term, IVS e-Visa and group visa restart and Hong Kong travel resumption will be necessary to drive GGR upwards.”
Macau Business reported that the International Monetary Fund (IMF) downgraded its economic growth forecast for the SAR to a 20.4 percent rise in its real gross domestic product (GDP). In April, the IMF predicted Macau would report 61 percent growth this year.
In related news, a recent public session on planned amendments to Macau’s gaming law was canceled due to Typhoon Kompasu, which passed by to the south on October 13.
In its notice on the cancellation of today’s meeting, the city’s gaming regulator stated it would schedule a new session “as soon as possible,” but would not extend the 45-day public consultation period on the revision, which began on September 15 and is due to run until October 29.
