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Macau continues to boom despite trade tensions

Tue, Mar 12, 11:57am by Staff Writer

China’s much publicised trade war with the United States has had repercussions for its economy, but the gambling enclave of Macau wouldn’t know it.

The city’s fortunes depend solely on the gambling industry, which takes in more in a single week than Las Vegas makes in a month.

In the past few weeks, Macau’s four casino giants – SJM, Sands China, Galaxy Entertainment and Wynn – have all reported a bumper year of gaming revenues and profits.

A 46-year-old car garage owner from the eastern Zhejiang province in China says he has little interest in seeing much of the former Portuguese colony during his five day visit with friends.

“I mainly come for playing at the casinos, not the sightseeing,” he tells AFP, saying he expects to drop around 50,000 yuan ($7,450).

“Apart from food and hotel, the rest will all be for gambling. And if I win some, then I’ll buy some luxuries like handbags and clothes.”

Players like Chen are the oil that keep Macau’s economic engine ticking – even in the midst of a trade war.

“The Macau market actually had a very good 2018,” industry expert at Union Gaming Grant Govertson said.

The good news is that the mass-market segment continues to exhibit solid growth and is the market segment that drives operating profits for the industry,” he said.

Casinos often paid little attention to players like Mr Chen, who were small fish in a big pond.

Instead they courted VIPs and high rollers to line their coffers.

After a government crackdown on corruption, VIP fortunes began to dip in 2014, as wealthy mainland gamblers tried to avoid attracting attention.

Mass market gamblers keep coming and up until January, Macau reported 29 consecutive months of gaming revenue growth.

Macau authorities tried to make the city less about gambling and push it as a food and family tourism destination in the wake of the corruption crackdown.

The drive appears to have paid off in terms of visitor numbers, according to Yahoo News.

The semi-autonomous city of just 620,000 people said that 35.8 million people visited in 2018, a 10 per cent jump on the year before, fuelled in part by the opening of a sea bridge linking Macau to nearby Zhuhai and Hong Kong.

The figures show Macau is still heavily reliant on visitors from Hong Kong and the mainland, who made up 32.6 million arrivals.

Loan sharks arrested in Macau

While Macau’s casinos steal the limelight, police announced late last month they had arrested 71 people for allegedly running a loan shark operation, the Macau Post Daily reports.

The arrests were revealed in a February 21 police briefing.

The accused were said to have loaned more than $13.8 million USD since 2016, bringing in a modest profit of $4 million USD.

The alleged gang leader, a 53-year-old Chinese man named Ma, was caught in the arrests.

Others arrested also hail from China, as well as Macau, Hong Kong and Thailand.

Police revealed the loan sharks were operating out of a VIP room in one of Macau’s casinos, keeping their documentation and profits all in one place.

These latest arrests come after 113 loan sharks were arrested in June 2018 for loaning out nearly $9 million USD.

Two major loan shark operations shut down in less than a year will be seen as a victory for Macau police, but considering there appears to be a clear market for the activity, it’s only a matter of time until another group picks up the slack.

Individual casino operators are left powerless to crack down on the activity, something that criminals could do out of a one-bedroom apartment. It goes without saying though, that utilising VIP rooms for such an activity is not a good look for the casino in question.

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