Macau’s pandemic recovery could be quicker than Vegas
Casino recovery from the COVID-19 pandemic in Macau could be quicker than in Las Vegas, according to a report from Fitch Ratings.
GGR Asia reports that while Macau’s comeback is predictable to happen sooner, there were issues in terms of mainland China’s public policy on outbound tourism.
The rating credit institution Fitch said the outlook for casino resorts in other Asia-Pacific jurisdictions, those reliant on international travellers, would in likelihood remain “tepid” on consumer-demand terms, amid the ongoing pandemic.
From September 23, residents in all places in China that qualify to take part in the nation’s Individual Visit Scheme, authorising independent outbound travel, will be able to apply for such exit permits for trips to Macau.
The Chinese casino hub has in effect a travel bubble with the mainland.
At the height of the pandemic, IVS permits for trips to Macau and elsewhere had been halted.
They were reintroduced in increments, starting with Macau’s neighbour, Zhuhai, and then the whole of Guangdong province from August 26.
Fitch Ratings noted in its Wednesday report that: “Travel restrictions remain n Hong Kong, with a potential for a reversal of mainland Chinese travel easing policy if there is an increase in coronavirus cases”
In normal trading conditions, mainland China, Hong Kong and Taiwan have been key feeder markets for Macau’s tourism businesses.
At present, Macau’s compulsory 14-day quarantine rules still apply on inbound travellers that have been to Hong Kong or Taiwan in the 14 days prior to arriving in Macau.
Foreign nationals, except those that also hold Macau ID, are barred from even entering Macau.
Fitch projected Macau’s gaming revenue for the third and fourth quarter would be down nearly 80 and 50 per cent respectively, compared to the equivalent periods in 2019.
The city’s gaming revenue for 2021 is projected to be about 20 per cent below 2019 levels, the ratings house said.
“Elsewhere in Asia Pacific, destination casino resorts in the Philippines, Singapore and certain states of Australia recently reopened and will have the benefit of respective local markets,” Fitch wrote.
“However, these gaming markets have varying reliance on international travel, which will remain tepid in the near term,” the institution added.
Fitch said it assumed recovery for global gaming companies would occur for the whole of 2021, through to 2023, with those firms focused on “destination markets” taking longer to recover, compared to those that have higher exposure to local markets and what Fitch termed “online channels”.
The institution said the negative “rating actions” had been applied to global companies since the onset of the pandemic, but noted the credit profile for most of them was “strong enough” for now, to allow them to weather the challenges of the pandemic.
Macau looks to expand city’s tourism offering
Macau is looking at broadening its horizons beyond gambling, to become a more well-rounded tourism destination.
Calvin Ayre reported in September that the COVID-19 pandemic has crippled the city’s gambling industry and serves as the perfect example of why diversification is needed.
Macau’s Master Plan for urban development has gone through its initial design phase.
The latest draft was released last week, with casinos still a focal point.
The plan keeps casinos where they are now in Cotai and New Outer Harbour Area, while stablishing new urban tourism zones that would not be open to casinos or other gambling activity.
Macau officials point to the northern region of Taipa, which could become an urban waterfront masterpiece designated to attract tourism and businesses.
A new tourism and leisure route specialising in different forms of entertainment could also be integrated and located around Nam Van and Barra urban areas.
The area closest to the Hong Kong-Zhuhai-Macau bridge could become the go-to spot for conferences and exhibitions, capitalising on the area’s proximity to the bridge and its link to the three significant hubs.
The Master Plan is just a concept, but one that has a lot of potential to see Macau morph into something completely different.
The public now has a chance to weigh in on what it thinks of the project, and can offer input until November 2.
After that, the project and the input will be reviewed and it will most likely be a year before anything else materialises.
In presenting the project, director of Land, Public and Works Transport Bureau Chan Pou Ha explained the department will have 60 days of public consultation, which will follow a period of 180 days for the company responsible for the consultation to elaborate on their preliminary report.
This report will be submitted to the Urban Planning Council, which will have to analyse it and provide comments.