Macau’s new gaming laws, which go into effect next year, include drastic cuts in gaming machines and tables. As a result, gaming equipment suppliers once based in the Chinese SAR are packing up and moving elsewhere.
There was a time when Macau’s gaming industry was bigger than others, including that of Las Vegas. Before COVID-19 and increased intervention from the mainland, its market enjoyed annual revenue of $36 billion.
That has changed now, however, with the new gambling regime coming. Bloomberg reports that this is causing Light & Wonder and other suppliers to look for more promising areas to set up shop.
Gaming Suppliers Skip Town
Jay Chun, the chairman of the Macao Gaming Equipment Manufacturers Association, told Bloomberg that there are at least four multinational gaming suppliers ready to move out of the city. He believes that more will flee, as well.
Light & Wonder has its eyes on the Philippines. Another unnamed equipment manufacturer, only described as being a Japanese firm, is sending around 30% of its workforce to the Philippines and Singapore. It has also redirected over 50% of its inventory elsewhere because of supply chain issues in Macau.
Singapore and the Philippines are growing exponentially. Macao has already lost its shine,” stated Macao Gaming Equipment Manufacturers Association chairman Jay Chun.
Macau expects gaming equipment suppliers to offer only innovative, advanced electronic gaming machines (EGM) to the city. It will also demand casino operators include additional responsible gambling measures, such as clocks, on all machines.
In order to meet Macau’s new rules, any new games suppliers submit must meet these and other stringent EMG Technical Standards 2.0. By the end of next year, at least 40% of the installed machines must meet the requirements.
Casinos then have another year to be 100% compliant. It’s a slow process, although Light & Wonder was the first supplier to receive 2.0 accreditation when its Carnival Cow slot was approved in May.
In addition, Macau has placed a limit of 12,000 on the total number of gaming machines it will allow going forward. There will also be a 6,000 cap on gaming tables.
Three years ago, there were 17,000 slots and over 6,700 tables. However, the financial burden amid reduced revenue, which already produced a reduction in gaming options, has many companies seeing less value in the city’s gaming industry.
Macau Slow To Recover
The sentiment to exit doesn’t cross over into all segments of the gaming industry. Melco Resorts & Entertainment said last month that it was considering moving its headquarters from Hong Kong to Macau. That move, however, is to appease the US SEC.
Even as Melco contemplates a relocation to the city, gaming revenue in Macau remains subdued. This is mostly a result of the COVID-19 pandemic, which continues to threaten the city directly. However, it’s also partly due to China’s zero-COVID-19 policy that continues to impact travel.
Slot machines were not a huge moneymaker for Macau – in 2019, they only provided 5% of the total gaming revenue. Macau is forcing more changes on its gaming operators and the city is moving away from VIP in favor of mass market gamblers. As a result, slots will become more important for generating revenue.
Bloomberg highlights the changing Asian gaming environment by pointing to G2E Asia, the annual gaming expo. Singapore’s Marina Bay Sands hosted it last month, the first time Macau didn’t. No Macau gaming supplier was present.
Singapore Catches On
The transition will undoubtedly benefit countries like the Philippines and Singapore. Both are ready to increase their positions in the global gaming environment and Singapore, in particular, is lowering the barrier to entry.
Last week, the country announced its new Overseas Networks and Expertise (ONE) program. This allows expats to bypass much of the bureaucratic red tape and find employment.
What we are really hoping to bring to Singapore are the rainmakers. It is an offensive strategy for us,” Singapore Minister of Manpower Tan See Leng told Bloomberg.
The ONE pass allows certain qualified expats to receive a five-year work visa easily. It also includes a caveat for their immediate family to gain access to employment opportunities.
Those positions that pay at least SG$30,000 (US$21,431) will be able to attract foreign workers. Authorized fields include “business, arts and culture, sports, science and technology, and academia and research,” according to the government’s description.
The program will officially kick off early next year. However, it might be too early to start dreaming about applying. The average salary in Singapore is around SG$8,450 (US$6,220), which means many people may not qualify.
The post Gaming Suppliers Lose Interest in Macau, Begin To Pack Up and Move Out appeared first on Casino.org.
Via Casino.org https://www.casino.org/news