Macau Casino Revenues Freefall on Chinese New YearPublished March 5, 2015 by Amir G
Macau casino revenues take a plunge on Chinese New Year with a 49 percent decline in February, the lowest numbers for the region in four years.
These are bad times for Macau casinos, as gross gaming revenue from the world's largest gambling center have shown a 49 percent decline this February. Macau's Gaming Inspection and Coordination Bureau has revealed this troubling numbers for a month in which revenues should be much higher – the festive new Chinese Year season.
In total, the Macau reported $2.44 billion in revenues last month – the worst reported since February 2011. This number amounts to some 19.5 billion Macanese patacas which were spent by gamblers at the region, a stark difference when compared to the 38 billion spent in February of 2014.
Market in Steady Decline
The new numbers are another part of a steady fall in China's big gambling region revenues, making it a ninth consecutive month of decline. Over the past year, Macau's six major casino operators have lost $89 billion in market value.
The decline has been attributed first and foremost to winds in the Chinese government wanting to diversify Macau's economy away from gambling, as President Xi Jinping said when he visited the region back in December.
VIP Players Drawn Back
Another reason for the decline is believed to be found in China's ant-graft on corruption which began last summer, which affected high rollers and VIP players who deterred from playing in Macau.
Another culprit is Macau's high prices. Analyst Ben Lee compared the price of a one-night hotel stay or a bet at a baccarat table in Macau to an average trip for a Chinese tourist from the mainland, sharpening the sense of Macau's high price and a reason why potential gamblers are swayed away from the region.
Recovery on the Cards
Despite the grim numbers, Macau is still the world leader in gaming revenues. Analysts are optimistic about recovery, saying that February figures were better than those estimated and believing that recovery is possible after mid-year due to operators not panicking and the opening of new resorts that will attract gamblers.