COVID-19 Resurgence Puts Macau GGR At Risk Says Morgan Stanley Asia
The COVID-19 pandemic was devastating for Macau’s gambling industry as it forced casinos to shutdown. Even when casino operators were allowed to reopen their premises, foot traffic was down as players from Mainland China and overseas were not keen on visiting the world’s biggest gambling hub.
Just when Macau casino operators were getting back to normal, another wave of COVID-19 appears to be threatening Macau again. Morgan Stanley Asia analysts predict that the November casino gross gaming revenue (GGR) for the region will be down by a sizable amount due to this threat.
The minimum drop in GGR is expected to be at 60 percent and could end up going all the way up to a 70 percent loss when compared to results from 2019. The main reason for this is due to the new travel restrictions in the region because of the fresh surge of COVID cases.
Market analysts predict that November’s GGR will only be $860.9 million. That is just 30 percent of the GGR that Macau registered in November 2019, which was before the pandemic.
This decline in GGR continues the downward trend for the region’s GGR, with October’s GGR also falling by 25.8 percent. COVID-19 is once again the main reason why Macau has witnessed a decline in GGR. Things usually pick up in October during the Autumn Golden Week. Usually, this long holiday period is when Macau welcomes tourists from Mainland China. Tourism is still struggling and Macau’s casinos continue to take a hit.
Experts are viewing the October performance as a prediction for what they can expect in November. The fact that fresh COVID-19 cases are spreading in China is not good news for Macau’s gaming market. If cases spread to the Guangdong region, the traditional gateway to Macau, then Macau’s casino earnings could suffer more.
Gaming Market Will Recover
However, despite all the bad news, the gambling market in Macau is still recovering and many experts agree that GGR will continue its improvement in pandemic conditions until December 2021. There will likely be no more major travel restrictions until next year, and hence nothing big will disrupt Macau’s casino market.
Market experts agree that the next indicator to monitor Macau’s GGR progress will be the upcoming Chinese New Year (CNY). If tourism numbers increase for CNY 2022, then it will likely be a good year for Macau’s casinos.