Macau’s land-based casinos were among those most affected by the international Covid-19 coronavirus pandemic.
In fact, in order to fight against the contamination, the Chinese authorities decided to put in place very strict sanitary restrictions that led to a sharp decrease in the number of tourists in this former Portuguese colony.
We have just learned that the latter will again be able to welcome groups of visitors from mainland China from next November. This news has led to a significant rise in the shares of casino operators active in Macau.
Restrictions have had a big impact on tourism and casinos in Macau
Since the global health crisis began, Macau has suffered a massive decrease in the number of its visitors which is mainly due to restrictions related to Covid-19. This has had a strong negative impact on the whole economy of this special administrative region of China which is particularly dependent on tourism.
The casino sector in particular has also been hit hard. Indeed, the overall revenues of all gaming establishments in Macau, for example, fell by around 50% year-on-year during August 2022.
Opening limited to 4 provinces plus Shanghai for now
Fortunately, the international pandemic of the Covid-19 coronavirus seems to be behind us now. This is the reason why the Chinese authorities have decided to soften the sanitary restrictions.
In a press conference held on Sunday, September 25, Macau’s Director General (Ho Lat-Seng) announced that the national authorities had authorized the former Portuguese colony to accept tourist groups from mainland China again.
Initially, 4 provinces are affected by this opening (Guangdong, Fujian, Zhejiang and Jiangsu) plus the autonomous municipality of Shanghai. It is expected that Macau will accept about 40,000 visitors per day, starting next November. This is about half of the number of tourists the city used to receive every day before the international health crisis began.
To facilitate travel to Macau, China will resume issuing electronic visas. However, it has already been announced that if the cases of Covid-19 contamination increase sharply, this opening could be questioned again.
Easing of restrictions benefits Macau casino operators
The news was extremely well received by investors, which greatly benefited Macau’s 6 casino operators. Indeed, their shares collectively rose by 8%, the day after the announcement of the partial reopening to Chinese tourist groups.
This represents the biggest rise in the shares of Macau’s casino concessionaires since last March. The main beneficiaries were the SJM Holdings and Sands China groups, whose shares rose by no less than 12%!
