Committed to Driving International Market

August 8, 2022 Macau Emerging Markets

It is important to anticipate the future; one shouldn’t postpone taking action if it can strengthen the economy and every person’s wellbeing. An economically strong city is politically strong which entails a realization of keeping Macau citizens moderately prosperous and socially stable.

How does it relate to Macau’s commitment to driving international market? Citing the Macau Government, the positioning of Macau is “World Center for Tourism & Leisure”, and the region needs to diversify its offerings. Yet the international market visitation from the past 20 years averages 8 per cent, while during the pandemic we have had zero international leisure visitation. Macau’s gaming tax & levies of 39 per cent are some of the highest in the world, making the enclave’s economy reliant on the casino industry with contributions of 70-80 percent of the government’s revenue.

This is expected to change. It is noteworthy that the cash-rich gaming industry is on the stage of the tender process and accepting bids for 48 days through September 14, as outlined in Executive Order 136/2022 of the Macau government’s Official Gazette. This is one of the key elements to driving a future attracting international market. The “concession contract for the operation of casino integrated resort tender document” stipulated that one of the evaluation criteria of bids requires the company’s proposal to develop tourist markets from foreign countries.

The new or renewed concessions are expected to be in place from January 1, 2023. Thus, the incentive of a maximum of 5 percent tax reduction could be given if the operators bring foreign visitors/players.

The question remains as to how feasible it is to begin driving foreign visits to Macau SAR when COVID-19 pandemic restrictions prohibit foreign tourist visitation and international flights are kept at a minimum level. In addition, as the outcome of the public tender is anticipated to take place in the fourth quarter, this raises a question on implementation, monitoring and tracking of foreign players. While answers to these questions are still unknown, one can start formulating what can be done to drive foreign visitation.