Macau Gambling Revenue Falls For Third Consecutive Quarter
Macau’s gambling industry is continuing to suffer as new figures show that gambling revenue in the region dropped by 35.5% in August compared to one year earlier.
The figures provide more evidence of a downturn and it has prompted the territory’s government to announce that it will be tightening fiscal spending. During August revenues fell by a massive $2.3 billion as China’s slowing economic growth has exacerbated the gambling slump caused by a broader crackdown on conspicuous spending.
These figures come after data was released which showed that Macau’s economy, which heavily relies on the tax generated by the region’s 36 casinos, has shrunk by 26.4% in the second quarter, its third consecutive quarter of double digit declines.
As a result Macau’s government has announced that all public sector spending will be subject to “austerity measures” which will include the freezing of a certain percentage of assets and services included in the annual budget.
Furthermore, a new agreement between Macau and China’s central bank to fight money laundering and a planned crackdown on underground banking could lead to further weakening following Beijing’s broad fight against corruption which was begun last year.
Macau’s VIP segment has been the hardest hit with a number of high stake gambling venues closing down and a potential smoking ban in VIP lounges could result in more closures.
On the other hand, Macau is still generating more than five times the revenue of Las Vegas and analysts expect revenue to improve in the second half of this year when Melco’s Studio City resort opens in October.