Despite poor January numbers, Macau should stay optimistic

Jon Pill
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Posted on: February 5, 2021 1:55 pm EST

Any hope we had for 2021 is taking its time to arrive in Macau. The January numbers are in, and the data is a mixed bag. Compared to January 2020, Macau reported a 63.7% drop in casino revenues. That said, Macau didn’t close up in response to the pandemic until mid-February, so the year-on-year data here is still pre- v. post-COVID numbers.

We now have somewhere between two and nine vaccines for the novel coronavirus, depending on how early in its trials you are willing to take a jab. Despite this, coverage for the vaccines remains low. The logistics for making and distributing vaccines are highly variable cross-planet. The metaphorical dumpster fires — and literal brush fires — of 2020 have smoldered on into 2021.

The result is that international travel remains a dicey business. In turn, the casino industry — and the hospitality industry it is built around — is having to take it on the chin. Again.

The shorter-term comparisons are a little more optimistic for Macau. The Macanese casino industry might have lost two-thirds of its weight since last-January, but this January showed further improvement over December. So, it might be too early for the city to fold its hand.

In raw numbers, casino revenues were about 8.02 billion patacas ($1.3 billion). This is an improvement of about 120 million patacas from December’s 7.82 billion patacas ($990 million). This in turn was an even bigger jump from November’s revenues of 6.75 billion patacas ($845 million).

Hope for the future

As well as the small rise in business month after month, there are a few other reasons to feel optimistic.

For a start, the casino industry has probably already swallowed the hit caused by Chinese money laundering crackdowns. The industry has downsized in response and shouldn’t lose too much more business to the paper pushers in Beijing.

The Chinese-manufactured Sinopharm and Fosun Pharma vaccines each have 100,000 doses earmarked for the Special Administrative Regions of China. Frontline workers in Macau and Hong Kong will start being vaccinated next week. Tourists from Hong Kong are big business for Macau, so the rollout in both SARs should help. Not to mention the general sense of optimism that vaccination programs give the market wherever they go.

Coupled with this, Hong Kong is looking at re-opening its flight links with Macau.

So there are plenty of reasons to look forward to a prosperous Chinese New Year in 2021 for the Vegas of the East.

Featured image source: Flickr