Macau's gambling industry enters 'stable' phase, says top official
Macau's gaming industry will see single-digit growth this year and is entering a "stable" phase, the city's secretary for economy and finance, Francis Tam Pak-yuen, said.
Tam's comments were posted yesterday on the Macau government website as the city's gaming inspection and coordination bureau released numbers for last month that show a second consecutive month of decline.
Gross gaming revenue dropped 3.6 per cent to 28.42 billion patacas, compared with a year ago, in line with market expectations.
In the year to date, Macau casino revenue was 221.5 billion patacas, up 10.2 per cent over the same period last year.
Tam said, "The gaming industry had been open for 10 years. The initial stage of development was more rapid and at present, had entered a stable phase of development. Hoping for extremely rapid growth is not reasonable and a stable pace will become the norm."
After enjoying years of double-digit growth, Macau's gaming revenue has started to drop off as economic growth on the mainland, which supplies the gaming hub with the majority of its visitors, slows down.
VIP growth has taken a dip due to Beijing's anti-graft drive, fears over a money-laundering crackdown on UnionPay cards and tightened liquidity for junket operators.
Although mass gaming has been a strong point overall, World Cup soccer betting created softness in the numbers from mid-June to mid-July.
However, Tam's forecast for single-digit full-year growth is at the more conservative end of the market consensus.
"My full-year expectation is 11 per cent, although the lowest consensus is around 8 per cent," Jefferies gaming analyst Leon Liao said. "Going into the third quarter, I think there is still a little bit of downside risk for VIP. In the fourth quarter, there may be a chance for recovery as that is always the high season."
Tam said the government would encourage diversification by restricting the gaming industry's growth and prioritise investments with non-gaming elements when it considered approvals for new gaming tables.
Pansy Ho Chiu-king, MGM China's co-chairman and daughter of casino mogul Stanley Ho Hung-sun, said last month Macau needed to diversify and become known as a destination for things other than gaming or risk losing tourists to rival cities.