Macau Gaming Revenues Down 2.6 Percent for 2014
The final figures are in for the world’s largest gambling hub Macau. According to the Macau Gaming Inspection and Coordination Bureau revenues for 2014 fell by 2.6 percent to reach $44.1 billion. Macau has had a tumultuous 2014 with December making for the seventh consecutive monthly drop in gaming revenues. Analysts forecast that December losses would be between 29-33 percent which turned out to be pretty accurate as the official figure was a 30.4 percent drop for the final month of 2014.
The reasons for Macau’s steep drop in revenues is largely blames on China’s massive crackdown on corruption by party officials and government members who in the past made up a huge portion of Macau’s gaming revenues. As we reported Chinese President Xi Jinping has vowed to crackdown on corruption and seek other streams of revenues for Macau. Xi believes that the former Portuguese Colony has become too dependent on gaming alone and needs to diversify in order to sustain long term growth in the region.
VIP’s are staying away from gambling in the fear that they will be dealt with by Chinese authorities. As a result Macau’s casinos have lost a combined $58 billion in market value over the last six months alone. To put the size of Macau’s gaming market in perspective, Macau generates more than seven times that of Las Vegas. The big question being asked is when or if the current crackdown on corruption will end and when will we see the high rollers return to the casino tables?