Low tourist numbers expected

Macau casinos reopen at 50% staff levels after two-week shutdown, but recovery prospects remain bleak

2022-07-25
Reading time 1:54 min

Macau casinos reopened Saturday after a nearly two-week shutdown mandated in an effort to stop the spread of Covid-19. However, without tourists, business was slow for the gaming venues, and analysts have estimated the closures could cost the casinos $1 billion.

In response, the government said it intends to distribute $1.24 billion to those businesses affected by the shutdown. Officials have also mandated that, even though allowed to return to business, casinos will be required to limit staff numbers to 50% of normal and must follow strict disinfection and health guidelines.

In addition, activities that require the removal of masks for extended periods of time -such as eating- may not be carried out indoors unless there is a separate room for each person, according to Europa Press. The initial phase of resumption goes through July 29, and has also seen public transport reinstated, with passenger capacity capped at 60%.

Non-gaming establishments such as bars, cinemas, nightclubs and malls are set to remain shut, while dining-in at restaurants is also banned. While Macau’s 41 casinos will avoid closure for the time being, it is unlikely they will open many tables due to an expected lack of customers going forward.

“We won’t be seeing any tourists,” Stephen Lau, president of the Power of the Macao Gaming Association, told Bloomberg. “At the rate things are going, tourists may not come back until mid- or late-August.”

The casino regulator -the Gaming Inspection and Coordination Bureau- confirmed to local media that 35 casinos had resumed operations on Saturday. Two casinos -at Regency Art Hotel and Broadway Macau respectively- remain closed as their associated hotels are currently being used for quarantine purposes.

Casinos were allowed to reopen after two weeks of closure as Covid-19 cases saw a massive drop off in the last few days. The city reported five cases on Saturday, compared with 146 at the peak of the latest outbreak. The gaming hub adheres to Beijing’s “Covid Zero” policy.

However, this restart may do little to stop Macau’s six licensed casino operators from burning through millions of dollars of cash every day, further reports Bloomberg. China’s extended suspension of quarantine-free travel is expected to keep discouraging visitors. City authorities want infections to hold near zero to bolster the case for reopening the border.

Macau’s gaming revenue has already plunged 46% in the first six months of the year, amid the repeated lockdowns and travel restrictions since outbreaks erupted in mainland China in March. The city’s own flareup started in June, prompting a shutdown from July 11.

According to estimates by Morgan Stanley analysts including Praveen Choudhary, the city’s gaming industry may only collect $7 billion in revenue this year. This would imply a 35% drop from last year, and would be 81% lower than pre-pandemic 2019.

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