Macau casino revenue keeps downward trend in May, forcing closures amid China’s tightened travel restrictions

June 2, 2022 Macau Earnings & Filings Industry Updates

Macau casino revenue has plunged amid the ongoing impact of the pandemic on the gaming destination. Revenue for May fell 68% from a year earlier, and the world’s biggest gambling hub continues to suffer from a tourist drought related to China’s stricter Covid-related travel restrictions, which are taking a heavy toll on the economy, causing businesses to close down and pushing unemployment to its highest level since 2009.

According to official data from the Gaming Inspection and Coordination Bureau, gross gaming revenue dropped to 3.3 billion patacas ($400 million), and while up 25% from April, it is 87% below the 26 billion patacas ($3.2 billion) reported in pre-pandemic May 2019, as reported by Reuters.

In this critical scenario, Macau Government showed signs of willingness to support the industry, as it proposed revisions to the gaming bill currently being scrutinized by the Macau Legislative Assembly, including a potential tax cut of as much as 5% on casinos’ gaming revenue, if they are able to bring in players from outside of China. However, on Monday, the Secretary for Economy and Finance, Lei Wai Nong, said that closed satellite casinos will not be permitted to reopen, despite the government’s recent U-turn in a legislative amendment that would allow gambling concessionaires to rent casino spaces from non-licensees.

Macau is the only place in the country where it is legal to gamble in casinos. Heavily reliant on casino taxes, which account for more than 80% of government revenue, Macau has had little success in diversifying its economy. “We are the most reliant city in the world on tourism. Of course, we didn’t have any other industries to fall back on,” said Glenn McCartney, an associate professor at the University of Macau.