Since Macau opened up as gambling capital in 2009, the city’s gaming revenue has only seen significant increases. However, 2014 has been a tough year for gaming operators in the city, as a government probe for corruption in the market has caused a dent in Macau’s casino market revenue. For three months in a row, Macau has seen its revenue decline – and, things do not seem like they will be picking up any time soon.
Since July, revenue in Macau has taken a 6% dive. Analysts blame the Chinese government’s crackdown on gambling corruption in the city. Many of the high rollers that gamble in Macau are government officials. They have been seen spending millions of dollars at table games across the city’s casinos – but, the probe into spending has seen them ‘suspend their discretionary spending’.
“Macau’s slowdown, particularly in the VIP and high-tier premium mass segments, is most likely a result of the loss of revenues from these high-spending customers who make up an important segment of Macau’s top-end customers,” reads a report from financial analysts Harry C. Curtis, Kelvin Wong and Brian H. Dobson. Since Chinese high rollers are spending less money in Macau, they are taking their VIP dollars to Las Vegas.
This is certainly helping to boost profits in the City of Sin, which has had a difficult time recovering from the economic downturn. While the probe continues, Australian casinos can also look forward to bringing in extra gambling revenue from Chinese high rollers. In recent years, we have seen more casino operators focusing on attracting Asian VIP gamblers.
Since this particular consumer group is no longer wagering at casinos in Macau, we may start seeing them migrate to Australian casinos that have recently shifted their focus to high roller gaming.