COVID-19 Puts a Damper on Macao’s Chinese New Year Celebrations
A spike in the number of COVID-19 infections in mainland China has hurt Macao’s gaming revenue, just as the world’s most profitable gambling enclave was starting to see glimmers of recovery.
An analysis conducted by Sandford C. Bernstein brokers revealed that Macao’s daily gross gaming revenue (GGR) calculated over the first 17 days of 2021, averaged US$34,6 million. However, due to the coronavirus’s resurgence in mainland China, the special administrative region was forced to tighten its borders, reinstating quarantine requirements for people arriving from two Chinese cities and four provinces.
Following the tightening of entry restrictions, the GGR growth stalled, dropping to a mere US$21,4 million for the week of 18 January.
New Year, Same Old Problems
This year, the Chinese New Year falls between 12 and 22 February. The celebration brings people across China together, who all partake in grand spectacles honouring the beginning of a new year in accordance with the traditional Chinese calendar.
The fanfare, also commonly known as the Spring Festival, is one of the most important annual Chinese calendar events. Employers in mainland China generally relax their working requirements during this period, with most employees given fully paid time off from their jobs, which the majority uses to travel on holidays or visit family.
For the past couple of years, Macao has been a favourite Spring Festival destination for the mainlanders. The city typically draws tens of thousands of tourists at this time of the year, which provide a welcome cash injection for local casinos and hotels and set the tone for the year ahead.
However, the rapid spread of the COVID-19 pandemic has left many Macao locals worried that this month’s holiday season would be a complete flop. This comes on top of a directive issued by the communist party authorities in Beijing that urges all citizens to avoid travelling in the coming weeks, or until a vaccine has been more widely distributed.
Forecast analysts at Sandford C. Bernstein noted: “The travel impediments will lead to reduced visitation into Macau for the next few weeks at least, with Chinese New Year visitation being impacted”.
Additionally, Credit Suisse gaming analysts have reported a notable reduction in bookings within the mass gambling segment of public gamblers. The financial service provider noted that the strict visa regime imposed by the Macao authorities is an added reason for the drop in visits, as well as the stringent local quarantine requirements that have dissuaded many to travel to the territory.
At the moment, all mainland Chinese who arrive in Macao from Shanghai and Beijing, as well as the provinces of Hebei, Liaoning, Jilin and Heilongjiang, have to undergo a strict two-week medical quarantine in the enclave. This has put off most visitors from these regions from travelling to the city, which is terrible news for the local economy since it heavily relies on travellers from these regions.
Year of the Ox
According to the traditional Chinse calendar, 2021 is the year of the ox. The Chinese view oxen as prized animals due to their resounding impact on the local agricultural sector. Fefe Ho of chinesenewyear.net notes: “Oxen are the hard workers in the background, intelligent and reliable, but never demanding of praise.”
Forecasts predict that this year will continue to knock hard on Macao’s gaming industry, which is the regional economic driver. Initial numbers had seen the GGR figures plummet by 67 per cent compared to January 2020, the last “normal” month before widespread lockdowns across China, as the wave of pandemics swept through Asia.