The head of Macau’s government gave a conservative forecast for gambling revenue next year that is 13 percent below analysts’ estimates amid a nascent recovery in the world’s biggest casino hub.
Macau’s government is confident the economy will recover to grow in the low single-digits next year, Macau Chief Executive Fernando Chui (崔世安) told a briefing after his annual policy address on Tuesday.
Chui’s gambling revenue target is unchanged from his forecast for this year, as the government seeks to limit the growth of its casino industry and pushed operators, such as Las Vegas Sands Corp and Galaxy Entertainment Group Ltd (銀河娛樂集團), to focus on tourists instead of hard-core gamblers.
“We didn’t set a higher target than this year, because we think there are still uncertain factors,” Chui said, referring to his gaming revenue forecast of 200 billion patacas (US$25 billion) for next year.
That compares with the estimate of 230 billion patacas from five analysts surveyed by Bloomberg.
Macau’s casino industry has been recovering since August from 26 straight months of revenue declines as operators open family-friendly resorts.
The territory’s shift from high-stakes Chinese bettors comes amid Chinese President Xi Jinping’s (習近平) efforts to curb official corruption and limit capital outflow, ordering Macau to diversify from gambling during his visit two years ago.
Macau’s recovery comes as China signals a crackdown on foreign casinos that woo its citizens to gamble overseas, detaining 18 employees of Australia’s Crown Resorts Ltd.
Macau’s gaming regulator chief Paulo Chan (陳達夫) met with the territory’s six casino operators
after the incident, reminding them to obey local laws when working outside the gambling hub and adding that Macau gaming would not be affected by the arrests.
The gaming regulator has also had several discussions on raising entry barriers for junket operators, intermediaries who bring in Chinese players and lend them money to play with, he said.
“The incrementally stringent regulatory tone from this policy address and the chief executive’s own guidance, in our view, do dampen the potential for out-sized gross gaming revenue growth next year, as is widely expected by consensus,” Daiwa Capital Markets Hong Kong Ltd (大和資本市場香港有限公司) analysts led by Jamie Soo (蘇文駿) wrote in a note.
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