Despite predictions of sustained growth in revenue September’s income figures from gambling in Macau were lower than expected by analysts. Macau’s casinos attract huge numbers of players from mainland China since this administrative region is the only area in China where gambling is legal.
There has been extremely strong growth in the casino market in Macau over the past several years with investment in luxurious casino resorts by major players in the casino industry such as SJM Holdings, Stanley Ho’s company and the Las Vegas based Wynn, Sands and MGM Grand groups among others. Given the world economic situation and also the slowdown in growth in China it has been expected for some time that growth in Macau’s casino industry would slow too.The expectation for a slow down in revenue in the casinos was based in part on the fact that the increases in revenue up to last year were spectacular and in part it was due to a decrease in spending power for the main Chinese clients of the casinos.
However in September while revenue did rise by 12.3 per cent this is about 5 per cent lower than predicted. At almost 3 billion dollars the September figures were the second lowest for 2012. There has been a decrease in gambling income over the past about five months. Macau’s economy relies heavily on revenue from its casinos and the industry provides about 40 percent of the region’s Gross Domestic Product. The Macau government has tried recently to diversify its sources of revenue and casino resorts being considered for construction must source a large part of their income from entertainment other than gambling to add to the attraction of Macau for tourists.At just over 12 per cent September’s gambling revenue was up on that of August 2012 at 5.5 per cent. During August there was a slight decrease in visitors to the region when compared to August 2011. Even taking this into account Macau still brings in over five times the revenue from gambling in Las Vegas and as a gambling destination it has outstripped Las Vegas. However analysts predict an increase in Macau’s revenue in October.