Macau’s casinos bounce back—but China’s crackdown still looms over growth
Macau’s gaming industry is showing signs of recovery after years of decline. The region has seen nine straight months of rising revenues, raising hopes of a return to its 2013 peak. However, concerns remain about China’s ongoing anti-corruption efforts and their potential impact on growth.
The downturn began in 2014 when China launched a sweeping anti-corruption campaign. The crackdown targeted casino junket operators, leading to arrests and scaring away high-rolling gamblers. Macau’s economy, heavily dependent on VIP players, slumped as a result.
Over time, the focus of the campaign shifted away from casino marketers. This change has helped the industry stabilise, with Macau now attracting more middle-class visitors. The region has also introduced new measures to curb financial crimes, including face recognition technology on ATMs to monitor capital flight and money laundering.
Despite the recovery, risks persist. Analysts at Sanford C. Bernstein warn that Macau’s economy remains vulnerable to Chinese government actions. They also noted a possible uptick in anti-corruption activity in early 2017. Still, Melco International chairman Lawrence Ho remains optimistic, predicting the industry will regain its 2013 size by 2022.
Macau’s gaming sector has adapted by reducing its reliance on VIP gamblers and broadening its appeal. The recovery, however, still depends on China’s regulatory stance. If anti-corruption measures intensify again, the region’s fragile rebound could face new challenges.
