\n(Bloomberg) \u2014 As Xi Jinping makes his first visit to Macau as China\u2019s president this week, the city\u2019s casinos would like to hear a reassuring word that might revive their tumbling stock prices. They\u2019re not likely to get it.<\/p>\n
\tXi, who arrived today to mark the 15th anniversary of the former Portuguese enclave\u2019s return to Chinese rule, is the man responsible for the two-year campaign against corruption in China, scaring away high rollers who have helped make Macau the world\u2019s largest casino gambling hub and wiping out $75 billion of casino operators\u2019 market value \u2014 bigger than the entire economy of Luxembourg.<\/p>\n
\tMacau, half of the size of Manhattan and the only place in China where casinos are legal, is viewed as a conduit for officials and businessmen to bypass currency controls and send money out of the mainland to safer havens. While anti-graft campaigns have been short-lived in the past, Xi is stepping up the effort in a bid to bolster the legitimacy of the ruling Communist Party.<\/p>\n
\t\u201cIt\u2019s more important for China\u2019s government to see Macau in a healthy economic development, and the reliance on corrupted official gamblers is not healthy,\u201d said Chen Guanghan, deputy director of the Chinese Association of Hong Kong and Macau Studies, a policy research institute backed by China\u2019s government.<\/p>\n
\tUnswerving Determination<\/p>\n
\tIt\u2019s important for Macau to maintain long-term prosperity and stability even it faces difficulties and challenges which should be handled appropriately, Xi said in a speech at a welcoming dinner, without elaborating.<\/p>\n
\tAn editorial posted on the official Xinhua News Agency website late on Thursday said the central government\u2019s strategy is for the diversified development of Macau\u2019s economy, to overcome the city\u2019s constraints and challenges to its growth.<\/p>\n
\tA separate editorial published in China\u2019s military newspaper this week said Xi\u2019s determination to rid corruption is \u201cunswerving\u201d and that it\u2019s a \u201cmistake\u201d to believe the campaign is coming to an end. In Macau, the authorities will start cracking down on illicit funds funneled through the territory, which sent casino shares plunging on Dec. 17.<\/p>\n
\tMacau\u2019s six major casino operators have lost about $75 billion in market value so far this year, based on the Bloomberg Intelligence Macau Gaming Market Index.<\/p>\n
\tMacau Contraction<\/p>\n
\tAmong the companies, gambling mogul Stanley Ho\u2019s SJM Holdings Ltd. is the biggest casualty with shares dropping 52 percent. The companies of billionaires Sheldon Adelson and Steve Wynn recorded an almost 40 percent decline.<\/p>\n
\tHigh-rollers, or VIP gamblers, make up about two-thirds of Macau\u2019s billion-dollar gaming market that contributed more than 80 percent of the city\u2019s total revenue last year. Xi\u2019s clampdown caused Macau\u2019s first year-on-year economic contraction since 2009. Now, the city is bracing for its first ever annual decline in casino revenue after posting losses for six straight months.<\/p>\n
\tXi is scheduled to attend ceremonies to mark the handover and inauguration of the city\u2019s newly re-elected Chief Executive Fernando Chui tomorrow. Beijing-backed Chui won a second five- year term as the only candidate in an election in August.<\/p>\n
\tThe Chinese president arrives at a politically sensitive period, days after neighboring Hong Kong declared the end of 11 weeks of the pro-democracy protests.<\/p>\n
\tNo Goodies<\/p>\n
\t\u201cI expect Xi Jinping to talk in fairly stern terms that he wants this economy to diversify and to move away from a casino- driven and, in particular, a high-roller economy,\u201d said Philip Tulk, a Hong Kong-based analyst at Standard Chartered Plc. \u201cI\u2019m not expecting anything to be distributed from his \u2019goodies bag\u2019 which we heard some in the industry talk about.\u201d<\/p>\n
\tThere had been industry expectations that the government would make it easier for mainland Chinese to cross the border and visit casinos after extending opening hours at borders linking Macau with the neighboring Chinese Zhuhai city.<\/p>\n
\tChina instead came up with more restrictions in recent weeks. Starting this month, it tightened rules for the transit visas issued for Chinese visitors entering from Zhuhai, closing a prior loophole used by many high-end players to go to the city more often and stay longer than normally allowed.<\/p>\n
\tThe stricter rules could add pressure on Macau\u2019s mass- market gaming revenue, Barclays analysts led by Phoebe Tse has said. In response to the VIP decline, companies including Sands China Ltd. and Galaxy Entertainment Group Ltd. have been building new resorts and shifting resources to target vacationing, mass-market gamblers.<\/p>\n
\tThe dominance of the casino gambling industry doesn\u2019t meet Macau\u2019s overall interest, and the city can\u2019t only focus on its own economic growth and tax revenue, state-controlled Teledifus\u00e3o de Macau reported this month, citing Li Fei, deputy secretary general of the National People\u2019s Congress, China\u2019s top law-making body.<\/p>\n
\tSocial Stability<\/p>\n
\t\u201cThe booming casino industry is definitely a money machine, but at the same time it\u2019s enlarging the social income gap that could damage social stability,\u201d said Chen from the China-backed policy research institute.<\/p>\n
\tMacau has seen at least eight labor protests this year with workers demanding better pay and welfare amid rising inflation and house prices.<\/p>\n
\tStill, Macau is seen less of a trouble maker than Hong Kong.<\/p>\n
\tAmid heightened security in Macau ahead of Xi\u2019s visit, the outspoken Apple Daily newspaper reported on Dec. 13 that one of its reporters as well as a pro-democracy protester attempting to enter Macau were sent back to Hong Kong as they posed \u201ca threat to internal security.\u201d<\/p>\n
\tXi\u2019s visit sends a strong political signal that Hong Kong \u201chas to learn from Macau,\u201d said Zou Pingxue, a member of the government-backed Chinese Association of Hong Kong and Macau Studies.<\/p>\n
\tHong Kong \u201chas been politicized and highly divided,\u201d said the law professor with Shenzhen University. \u201cMacau is a good example for Hong Kong in this case.\u201d<\/p>\n
\t\u2013With assistance from Billy Chan and Jasmine Wang in Hong Kong.<\/p>\n
No replies were posted for this topic.<\/p>\n","protected":false},"excerpt":{"rendered":"
(Bloomberg) \u2014 As Xi Jinping makes his first visit to Macau as China\u2019s president this week, the city\u2019s casinos would like to hear a reassuring word that might revive their tumbling stock prices. They\u2019re not likely to get it. Xi,…<\/p>\n","protected":false},"author":36,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[10],"tags":[],"class_list":["post-8447","post","type-post","status-publish","format-standard","hentry","category-latest-casino-news"],"_links":{"self":[{"href":"https:\/\/forumarchives.tmsites.net\/index.php\/wp-json\/wp\/v2\/posts\/8447","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumarchives.tmsites.net\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumarchives.tmsites.net\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumarchives.tmsites.net\/index.php\/wp-json\/wp\/v2\/users\/36"}],"replies":[{"embeddable":true,"href":"https:\/\/forumarchives.tmsites.net\/index.php\/wp-json\/wp\/v2\/comments?post=8447"}],"version-history":[{"count":0,"href":"https:\/\/forumarchives.tmsites.net\/index.php\/wp-json\/wp\/v2\/posts\/8447\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumarchives.tmsites.net\/index.php\/wp-json\/wp\/v2\/media?parent=8447"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumarchives.tmsites.net\/index.php\/wp-json\/wp\/v2\/categories?post=8447"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumarchives.tmsites.net\/index.php\/wp-json\/wp\/v2\/tags?post=8447"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}