The New Call of Macau to Europe: Via WeChat?
Published August 28, 2020 by Lee R
A trade war with China is spilling into Macau, at great cost to North American operators and including a close Trump ally.
The Trump WeChat ban is pervading iGaming's most unsightly post-Covid site.
WeChat Ban Justification
The US President's ban on Chinese social messaging giant WeChat has been called due to “undermining” of “national security.”
Personal Over Economics?
The ripple effect from this personal vendetta is reaching all the way to battered Macau.
That's because WeChat is vital to linking North American casino operators with players from mainland China.
Big Names Stifled
Now, Las Vegas casinos with major interests in Macau including Wynn Resorts, MGM Resorts International and the Las Vegas Sands of Trump's buddy Sheldon Adelson could be taking big financial hits as a result of the applicability of the executive order to US citizens and corporations carrying out “any transaction related to WeChat.”
Losing the Link to the Mainland
With the edict is set to take effect in 45 days from last Thursday, a week ago, Macau-based lawyer and former Sands China legal advisor Carlos Lobo estimates that 95% of Macau’s total gaming patrons are mainland Chinese, whom provide an estimated 90% of the island's gaming revenues.
Lobo says without WeChat, North American organisation will be severely limited in their ability to communicate with any teams they traditionally put on the ground in China for recruiting and promotion.
Vital Communications Tool
Until now, the WeChat app had emerged as the key to remote sustainability in Macau by North American casinos because of the app's popular facilitation of outreach to China's mainland junkets and individual players in a landscape of legal prohibitions against gaming and advertisement.
Crippling Competitiveness
Macau-based consultancy firm IGamiX managing partner Ben Lee confirms that North American casinos have come to rely competitively on the WeChat social app: “If they are deprived of this channel, in the absence of any other channel, they will be severely disadvantaged compared to their [non-US] peers.”
New Hope for Macau
However, for once Macau may have some relief, with Lobo pointing out that other non-American operators unbound to Trump's blanket order are likely ready to step in and fill that void, citing European brands Melco, SJM Holdings and Galaxy.
Outlook
In Macau's case, North America's trade war with China looks like Europe's gain, and possibly a pipeline to fresh investment and even new visitors to this once proud and now struggling gaming mecca.
