Macau's casinos reported a remarkable surge in gross gaming revenue (GGR) in August, marking a more than 686% increase compared to the same period last year, according to data from the Gaming Inspection and Coordination Bureau (DICJ). The GGR for August reached MOP17.2 billion patacas (approximately $2.17 billion). This figure also represented an increase from the GGR posted in July, which stood at MOP16.7 billion ($2.1 billion).
The accumulated revenue for the year now stands at MOP114 billion ($14.1 billion), accounting for approximately 87.7% of the government's annual target of MOP130 billion ($16.09 billion). Given the ongoing recovery, Chief Executive Ho Iat Seng indicated that the annual goal could potentially rise to MOP180 billion by year-end.
Despite the challenges of the past year, the latest figures show that Macau's gaming revenue has rebounded to about 71% of pre-pandemic levels. This resurgence has been driven in part by increased tourism levels during the summer vacation period, with the city reporting 2.8 million visitor arrivals in July, equivalent to 78% of pre-Covid levels.
Interestingly, Macau's casino operators have not been significantly impacted by China's recent economic slowdown. Analysts from Morgan Stanley, including Praveen Choudhary, noted that the richest 1% of China's residents continue to travel and spend on entertainment as usual, providing support for the gaming sector.
However, casino operators are approaching September with caution, as gaming revenue typically experiences a 9% month-on-month decline following the boost from the summer vacation period, according to Morgan Stanley.
Macau has been actively diversifying its economy away from gambling, with the casino sector reducing its reliance on high-rolling gamblers from mainland China due to Beijing's increased scrutiny of capital outflows. Casino operators have committed significant investments, totaling at least $13 billion over the coming decade, to develop non-gaming industries. This year, they have also focused on hosting more concerts and conferences to attract mass-market tourists and business visitors.
The second half of the year is expected to test the industry's resilience as uncertainties in China's economy persist, and Macau faces competition in luring visitors with the resumption of group tours to various countries.
By fLEXI tEAM