Macau casinos set for ‘single-digit’ growth rebound in 2017, but vulnerable to China’s capital control

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Macau casinos should see a ‘single-digit’ revenue growth rebound in 2017 according to Fitch. Photo: Reuters

Published: 3:15pm, 13 Feb 2017Updated: 10:16pm, 13 Feb 2017

Macau’s gaming industry has shown signs of life and will see a swing to positive single-digit growth in 2017, but optimism may be restrained by mainland China’s policies, including stricter capital control, a corruption crackdown, and a potential large one-off yuan depreciation, according to analysts from Fitch Ratings.

After a dismal 2016, Macau, the world’s largest gaming market, will witness a mid-to-high single-digit growth in gaming revenues for this year, underpinned by the recovery in both VIP player and premium mass segments, the stabilisation in China’s economic growth, and the opening of new casino resorts, said Alex Bumazhny, Colin Mansfield, and Vicky Melbourne, analysts for Fitch Ratings, in a recent research report.

The industry has seen its monthly revenue growth average about 10 per cent since last September, according to forecasts by Fitch.

“This growth coincided with the opening of The Parisian and Wynn Palace in the third quarter of 2016, as well as relatively solid China economic indicators,” they said.

Construction work underway on the Hong Kong-Zhuhai-Macau Bridge on January 2017. The infrastructure improvement will make travel between Hong Kong and the Macau gateway easier. Photo: EPA

Wynn Macau opened the doors to its US$4.2 billion casino resort Wynn Palance on the Cotai Strip on August 22. Meanwhile, Sands China, a subsidiary of US casino tycoon Sheldon Adelson’s Las Vegas Sands, launched its US$3 billion The Parisian Macau resort on September 13.