While the global outbreak of the COVID-19 pandemic is yet to hit its peak in some countries, operations are slowly picking up in China following its recovery. To boost its economy even further, all eyes are set on Macau,Asia’s gaming capital, which boasts over 41 top of the line casinos. However, even with their recent re-opening following the February shutdown, the numbers are still worrying.
In 2019, the former Portuguese colony received an influx of up to 108K visitors per day. That number has since then gone down by 92%. As a result, the stakeholders have pushed for measures to get them back on track. One being the re-introduction of online gambling, which has always been outlawed in mainland China.
The Race to get things back up and running
It would be such a shame to see China’s economy crumble even further when they have the power to do something about it. I recently took a trip to Macau and discovered why it is dubbed as “The Las Vegas of Asia.”
It’s giant Orwellian-style skyscrapers, temples, and a mixture of Chinese and Portuguese restaurants give it a strange, yet familiar feeling. You’ll find that there are even big American names such as the Las Vegas Sands Corp. MGM Resorts International, Melco Resorts & Entertainment and Wynn Resorts Ltd.
To get there, you’d have to take a one-hour ferry from Hong Kong or take the easy route and fly in through the Macau International Airport. Nonetheless, recent studies have shown that Casinos in Asia will rebound more quickly than the ones in the U.S.
Why are the numbers still down?
The current measures taken to curb the spread of the recent virus have not made it easy for most business operations. Social distancing, border patrols, and total lockdowns have been a thorn in various entertainment outlets.
As a result, the numbers went down from 108K visitors a day to only 2800. This is mostly a result of border restrictions and travel bans from foreign countries. Picture it this way; most of their clientele are foreigners, and with all flights grounded, the hope of a rise in the numbers seems like a pipe dream.
If by some miracle, you manage to get into the country, you’ll have to undergo a 14-day quarantine expedition before you’re allowed into any casinos. Coming back, you’d also have to undergo the same quarantine rules. Now, if that doesn’t derail your plans, then I don’t know what will.
But wait, there’s still hope for Macau Casinos.
Measures undertaken to increase numbers in Macau Casinos
The United States casinos shut down in March, a month after Macau ceased operations in their casinos. However, barely a month later, most Macau casinos re-opened their services. As a result, most authorities pushed for benchmarking to see what worked for them and what didn’t, in a bid to open their casinos.
As they stand now, none have yet to resume normal operations.
To curb the spread of the COVID-19 pandemic, Macau casinos have enforced certain restrictions that have seen total control over the situation. They include:
Normalizing the use of face masks
Recovery cases in China have been on the rise partly due to the fact that the locals have normalized the use of face masks. In some countries, most users still don’t believe in the existence of the COVID-19 and have refused to wear face masks.
Having test kits at entrances of all major entertainment outlets.
Upon entry into any Macau casino, you will be subjected to temperature checks and other tests to ensure you are free of the virus. It’s a small price to pay as most customers can’t wait to get their gambling on.
Social distancing by reducing the number of tables and stations
Most Clubs and Casinos have now reduced the number of chairs, slot machines, and tables to keep up with the social distancing regulations. The Venetian Macau, for instance, which is one of the largest casinos on the island, had to cut down its vast selection of 800 gambling tables to half.
Employees health checks
Forget the gamblers; the real risk lies with the casino employees who deal with the cards, money, dice, and other commodities. In a bid to stop the spread, casino employees are subject to health checks every day, and they must also attest to their health before getting to work.
What about the locals?
Aside from foreigners, the island is also home to over 600K civilians within the city limits. Right now, the Hong Kong ferry services to Macau are no longer in operation. The only other active route is to use the Kong-Zhuhai-Macau Bridge, which has its own restrictions.
To increase the number of gamblers visiting the casinos, the local government issued incentives by offering permanent residents spending cards pre-loaded with $327. This would help increase spending in local stores, casinos, and in turn, uplift the local economy. The distribution is currently still ongoing, with numbers set to rise in the coming weeks.
With all these measures, you’d probably think that the joints would be packed by now. Well, that isn’t the case as the number of daily visitors is still low at 2800. So what other measures have they employed?
Introduction of online gaming
Online gambling in Asia has mostly been unregulated, with countries like the Philippines making up the most of online gambling. However, in China, it’s a whole different story. It all started in 2000 when the government-insured restrictions on gaming but would later lift them in July 2015. However, the Chinese government recently took its gaming censorship to the extreme by cutting off online gamers from other players outside China.
However, with the recent pandemic, many leaders have come together to develop innovative ideas — one being GAME, an acronym for Gaming Asia Mega Experience tables by MGM China’s operations. One managing partner at SpringOwl Asset Management, who was also once a former board member at Las Vegas Sands, also gave out his thoughts on online gambling.
He urged the governments in Asia to legalize online gambling, as seen with emerging trends in Europe and the United States. The correct way to go about it would be to sanction licensees to participate in the trend by implementing higher taxes and more regulations.
One China, Multiple Systems
Since Chinese law doesn’t really apply in the Macau region, they mostly operate under a separate jurisdiction. As a result, there are currently no laws regarding online gambling, which is both a good and bad thing. To the consumer, the lack of regulations works in their favor as they are allowed to place bets with foreign-based online casinos.
Citizens in Hong Kong, just across the water, don’t have this privilege as the government works against the online operators. Moreover, most online operators back down in fear of working against the Chinese government. However, with the recent developments, more and more online operators have emerged in Macau.
What Makes the Casino business flourish in Macau?
The Macau experience didn’t just spring up overnight; it dates as far back as the 1940s. Like Hong Kong, it’s the only place in the whole People’s Republic of China where gambling is considered legal. With that, the region benefited greatly from gambling tourism, especially with the introduction of Western-style games ever since the late 60s.
It was also a great space for people living in China due to its close proximity to the mainland. There was a time it faced monopolization by the billionaire, Stanley Ho, who owned as much as 33% of the gambling scene, including the prestigious Casino Lisboa.
The government finally stepped in 2001 to end the local baron regime, which became the origin of Macau’s success. High rollers soon made Macau their gambling destination, bringing their investments with them. By 2013, reports had it that over 66% of the generated revenue in Macau came from high rollers.
How big are Macau casinos?
During the Chinese New Year, for instance, the numbers skyrocket as more people come to gamble. The Venetian, which is one of the largest casinos in the world with 550,000 square feet of space, receives more than 100K gamblers during this period. In comparison, its namesake in Las Vegas only has a space of 120,000 square feet.
It doesn’t matter whether you’re in Peninsula or the Cotai Strip; you can always find a casino near you. There are currently 24 and 17, respectively, bringing the total up to 49 casinos. Big players, such as SJM Holdings, Las Vegas Sands, and Galaxy Entertainment, have also added onto Macau’s names as “the Monte Carlo of the East” and “the Gambling capital of the world.”
It’s time for the local government in Macau to research on the way forward in the gaming industry. Since other countries have not yet recovered from the COVID-19 pandemic, it might take a while to restore the name of Macau as the Las Vegas of Asia.
