Macau Tourism Increase Attributed To The $2bn Casinos In Cotai

The opening of two integrated casino resorts in Macau’s Cotai district has been labelled as the primary reason for an increase in tourist arrivals to Macau. Tourist arrivals in September to Macau were at 2.4 million, an increase of 0.5 percent year-on- year, according to latest data released by the city’s Statistics and Census Service. Arrivals from Mainland China were up by 0.3 percent over same period last year reaching nearly 1.6 million in September.

For the period between January and September, the total arrivals to Macau were at 22.9 million, a marginal rise of 0.1 percent on a year-on- year basis. In a statement, Christopher Jones analyst at Buckingham Research said

We would attribute the increase in visitation in September to increases in supply from Wynn Palace and Sands’ Parisian

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The two casino properties being referred to are Wynn Resorts $4.3 billion Wynn Palace launched in late August and the $2.7 billion Parisian launched by Sands China Ltd in early September. These two casinos are among the first to have a host of attractions and facilities that target mass market tourists rather than Macau’s traditional wealthy gambling tourists.

Most of those who gamble in Macau are tourists visiting the city. However historically visitor numbers are not correlated to gaming revenue trends since in the past Macau had a high proportion of VIP gambling revenue. This recent increase in visitors is however seen to have a correlation to a growth in GGR (Gross Gaming Revenue). The GGR for Macau went up by 7.4 percent in September to MOP18.40 billion (US$2.30 billion) as per data from the Gaming Inspection and Coordination Bureau.

This is the second month where the GGR has seen an increase after the market declined consecutively for 26 months. The first sign of revival was in August when GGR saw a rise of 1.1 percent on a monthly basis. These growth trends have given hope that the slide in Macau’s gaming revenues is coming to an end.

MGM China Holdings Ltd co-chairperson Pansy Ho Chiu King commented earlier this month that all key indicators such as gaming revenue, visitor arrivals and consumption demand were stabilizing after a long decline signifying a market shift. Analysts from brokerage firm Sanford C. Bernstein Ltd observed in a note that Macau registered 863,000 overnight tourists arriving from Mainland China in September, as opposed to 715,000 day trippers who came to the city during the same period. According to them this was a positive sign for the industry since overnight visitors are considered more valuable than day trippers.

Adrian Sterne

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