Posted on: November 15, 2022, 01:04h.
Last updated on: November 15, 2022, 02:26h.
Macau Chief Executive Ho Iat Seng says it’s the local government’s plan to continue adhering to Beijing’s “zero-COVID” policy that necessitates isolated lockdowns in response to newly detected coronavirus infections.
Macau fielded some good news last week when China announced it is relaxing its entry protocols for foreigners. The easing reduced the number of required quarantine days for arriving travelers from seven days to five.
The news out of Beijing resulted in Macau casino stocks making considerable gains, something investors of the six firms have been patiently awaiting after their stakes plummeted in value amid the pandemic. But Ho told the media Tuesday, following his 2023 Policy Address, that the region has no immediate plans to distance itself from “zero-COVID.”
Taking into account the epidemic situation, we must persist in the policy,” Ho declared, as first reported by GGRAsia. “Macau has to follow China’s dynamic zero-COVID-19 policy.”
Macau is one of two Special Administrative Regions (SARs) of the People’s Republic, with Hong Kong being the other. The SARs are to operate under China’s “one country, two systems” principle.
Under the “one country, two systems” arrangement, Macau is a self-governing autonomous region that follows the mainland’s lead when dealing with national security issues. The pandemic has been deemed a national security risk by the Communist Party.
During his 2023 Policy Address on Tuesday, Ho refrained from detailing the progress Macau has made in issuing fresh gaming concessions. As many as six licenses are available, with each coming with a 10-year operating privilege beginning as of Jan. 1, 2023.
The current six gaming firms — Las Vegas Sands, Wynn Resorts, MGM Resorts, Melco Resorts, Galaxy Entertainment, and SJM Resorts — are the front runners for the coveted permits. But newcomer Genting Malaysia has thrown its candidacy into the bidding pool to slightly cloud the next market lineup.
Ho’s address focused on Macau’s commitment to diversifying its economy away from casino gambling. Macau currently generates more than 80 cents of every tax dollar from its gaming industry.
Ho says the six licensed gaming firms will collectively be on the hook to invest an aggregate of approximately MOP100 billion (US$12.4 billion) over their 10-year license terms. Each applicant is negotiating with the enclave government to determine their specific investment liability in exchange for a new concession.
“The gaming interests will work towards promoting, in a more pragmatic way, the synergistic development between gaming and non-gaming industries,” Ho stated in the address.
In his Policy Address, Ho detailed four sectors Macau hopes to better embrace next year and in the future. They include the “big health” industry, “modern financial services,” technology, and conferences and exhibits.
The latter is where Macau’s six casino operators will likely spend their roughly $2 billion investment minimums.
MICE, or meetings, incentives, conventions, and exhibitions, is a major component of the integrated resort (IR) sector. The late Sheldon Adelson, the founder of Las Vegas Sands who was responsible for envisioning and building the Cotai Strip in Macau where today’s glitziest high-roller casinos are located, was the first to identify how casinos and MICE venues could coexist.
Ho says it’s Macau’s goal to gradually increase the non-gaming sectors’ contributions to Macau’s gross domestic product by 60%, though he didn’t outline a special target date for accomplishing that goal.