Is Macau's gambling industry on the verge of collapse?
When you think of gambling megacities, you almost inevitably have Las Vegas in mind. One or the other may still think of Atlantic City. But for the most part it was. However, if you frequent Asia or have ties to the Far East, you probably have to think of the former Portuguese colony of Macau when you think of gambling. Because nowhere else in Asia is gambling more widely represented than here. But "Asian Las Vegas" is currently struggling with economic problems, some of which are domestic, but mostly imported from (international) national politics.
This is how we know Macau: lots of bright lights, fireworks and stately buildings. But how long will China's special administrative region shine brightly?
Macau: the oriental Las Vegas!
It should be clear to everyone that Asian culture is somewhat different from European culture, or perhaps even American culture. However, what meets with enthusiasm among people of all ages and social classes is gambling. There is hardly any other explanation for the fact that Macau is about as economically and culturally important to China as the dazzling Las Vegas is to the US. Good to know : Macau has long resembled the sports betting market in the US.As with Las Vegas and Nevada, Macau has also had an exemption for gambling since 2002, which in China is only allowed for two state-run lotteries. And in Europe, the Danish Casinoudenrofus.info is like Las Vegas in the US. Macau is visited by an average of 31 million gamblers a year, and numerous casinos earn about 30 billion US dollars a year. This makes Macau a more significant international gambling destination than Las Vegas. Just how much the thriving gambling industry depends on the country's economy was recently demonstrated by the peninsula at the mouth of the Pearl River. After political and economic disputes between the US and China, trade boycotts and tariff threats, the Chinese economy has had to contend with a stagnant economy, especially since the second half of 2018.The Asian People's Republic's economic growth is still 6.5 per cent, but what would be record growth for other countries has meant the worst growth rate for China since the 2009 financial crisis.There is less money available for use in casinos at roulette and blackjack tables.
So analysts predicted much worse figures for Asia's post-September 2018 gambling mecca and predicted a drop in sales of up to 20 per cent. For many of Macau's big casinos, this meant the risk of economic collapse. In fact, it turned out differently, as contrary to all assumptions, December was a big plus compared to the same period the previous year: gross revenue rose by almost 17 percent in the last month of 2018!
Gambling in Macau is no less dazzling and exciting than in the American desert of Nevada. However, the "economic miracle" has not led to more optimistic predictions by experts for 2019, quite the opposite. Because a trade war between the US and China cannot be ruled out, even if both sides have come closer in the last few weeks and made it clear to their partners that they are willing to make concessions at least for a short period . But it is not just the trade dispute and the resulting drop in sales that worry analysts and casino operators. Because the trade dispute and low sales figures also have a negative effect on casino shares. High interest rates in turn will make investments more difficult and necessary upgrades will not be made, putting a strain on share prices again. Good to know: Curious: In mid-2018, Macau politicians passed a legislative resolution that casino employees in Macau will no longer be allowed to gamble privately. All casino employees - from security staff to croupiers - will be affected. According to political statements, this is aimed at combating gambling addiction. In total, more than 54,000 employees in Macao will be affected by the decision. As a result, a further negative impact on the gross revenues of the gaming industry in Macao cannot be avoided. Furthermore, it is to be expected that the gambling licences of US casino operators in Macau will not be renewed by the Chinese authorities. The first licences expire in 2022. If they are not extended, the Six US casinos in Macau are already facing an end, which will weaken the economy of the entire region. Political developments in the coming weeks and months should therefore also decide where Asia's Las Vegas goes in the coming weeks.
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