Macau: With US-China Trade War Intensifying, US Casino Operators May Start To Pack Up

Macau: With US-China Trade War Intensifying, US Casino Operators May Start To Pack Up

The US-China trade war continues to take a toll on Macau’s gross gaming revenue (GGR). With the relation between the two countries not showing signs of improvement, experts have started questioning whether the US-based gambling operators will be able to continue business as usual in the Chinese-controlled territory.

The gambling operators are also already facing the heat of the ongoing trade war and the prolonged pro-democracy protests in neighboring Hong Kong.
Moreover, following China’s change in policy which calls for making Macau a family holiday destination, holding on to the casino gambling licenses in Macau is becoming increasingly capital intensive with diminishing returns.

Liang Ming, a researcher at the Chinese Academy of International Trade and Economic Cooperation, an affiliated institution under the Ministry of Commerce (MOC), has said that it is very unlikely that US gambling operators would have to pack up their businesses in Macau.

However, he did not rule out the possibility of Chinese-funded companies taking over American businesses in Macau in an extreme scenario. He was speaking to reporters at “Macau’s Economy Forum 2019” at University of Macau (UM).

He said that “if they would choose to leave [Macau], we could look for other entities to run their businesses, and this would possibly be just a matter of a change in the structure of shares. In this situation, Macau companies or mainland Chinese-funded companies could take over and run these venues [casinos].”

Three of Macau’s six casino gambling operators in Macau are from the US: Sands, Wynn, and MGM. SJM, Galaxy, and Melco are Macau or Hong Kong companies.

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