Macau Casino Operators Lose $75B In Market ValueStocks Plummet As Gaming Win Continues To Decline |
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Macau has seen six straight months of year-over-year gaming revenue decline, as the former Portguese colony will soon witness casino win falling significantly from last year’s record of more than $45 billion.
As a result of the recent downturn, casino operators there have seen $75 billion in their market value wiped out, according to reporting and alaysis from Bloomberg.
That’s larger than the entire economy of Luxembourg.
The Chinese government has been cracking down on what it perceives as corruption in Macau, as it reportedly sees a heavy reliance on high-rollers as an unstable long-term plan for the city. Two-thirds of Macau’s gaming revenue comes from VIP gamblers, who typically deal with junket operators to get the cash they need to wager huge sums at the table games.
Nearly 220 junkets are licensed in Macau.
“It’s more important for China’s government to see Macau in a healthy economic development, and the reliance on corrupted official gamblers is not healthy,” Chen Guanghan, deputy director of the Chinese Association of Hong Kong and Macau Studies, told Bloomberg.
In other words, it appears Macau is quickly going to be moving away from a high-roller based economy in favor of something more sustainable. Casino’s represent 80 percent of Macau’s economy and that apparently has mainland China worried.
According to Bloomberg: “Among the companies, gambling mogul Stanley Ho’s SJM Holdings Ltd. is the biggest casualty with shares dropping 52 percent. The companies of billionaires Sheldon Adelson and Steve Wynn recorded an almost 40 percent decline.”
Macau currently has 35 casinos. Eight more are in the pipeline.
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