After a decade of expansion, Asian gambling centre Macau has recorded its first ever growth decline, as city casino revenues fell by 2.6% to $44 billion. Asian business analysts expect tougher times ahead for the city, as it recorded a 30% monthly revenue drop this December.
The gambling hub has been targeted the Chinese Public Security Ministry as China aims to fight corruption and money laundering a key political concern for President Xi Jinping.
The crackdown on corruption has deterred high rollers from visiting the city and playing at casinos, In turn analysts have estimated that the campaign has wiped out $73 billion in market value of companies including Wynn Macau and SJM Holdings.
Earlier this year, XI Jinping had warned Macau officials that the province needed to end its reliance on gambling and look to attract other business industries to operate in the region. The Chinese government stated that it would support Macau as it looks to grow its industry outside of gambling.
Philip Tuck Hong Kong Standard Chartered Industry Analyst commented to Bloomberg News
“The anti-corruption crackdown doesn’t look to be a short-term phenomenon, with funds flows between the mainland and Macau being much more closely scrutinized. It appears that the VIP heyday is now over”