Shares in Macau casino operators shot up to 13% on Monday after the city’s leader gave some long overdue good news.
Macau chief executive Ho Iat Seng said on Saturday that China would resume an internet visa scheme for travellers from the mainland and permit group tours.
This was music to the ears of casino operators, who have suffered nearly three years of low tourist numbers because of travel restrictions imposed during the Covid-19 pandemic, which hit China hard because of its lack of effective vaccines.
Ho Eat Seng said they will aim to open Macau to tour groups from the mainland in November – about five weeks time.
The moves are likely to boost visitor numbers in the Chinese special administrative region, which is the only place in the country where it is legal for citizens to gamble.
Macau, a former Portuguese colony, has implemented stringent Covid restrictions with tight border controls since 2020 and they had a major impact on the enclave’s casino industry.
Sooner Than Expected
Analysts said the announcement came earlier than expected – they had anticipated such measures may not be introduced until early next year. Mainland gamblers account for around 90% of total casino revenue.
“Although it’s tough to quantify the immediate benefit, we believe the resumption of e-visas and group tours should alleviate friction for a Macau trip, as well as signal to many that it’s okay to visit,” DS Kim, an analyst at JP Morgan in Hong Kong, said.
“Finally we feel we can talk about a return to normalcy.”
Sands China rose more than 13%, Wynn Macau climbed 7%, Galaxy Entertainment advanced 10% while shares of SJM and MGM China jumped 8% each.
While the border between Macau and the mainland has been open for two years, traffic remained sluggish due to the lack of e-visas, which were readily used by Chinese gamblers prior to the pandemic to make instant bookings.
Currently, Chinese tourists to Macau need to book a visa appointment followed by a week-long approval process. The individual visa scheme accounted for around 50% of Chinese visitors to Macau in 2019 while tour groups accounted for around 25% of visits.
In the first phase, the resumption of tour groups will come from five provinces – Guangdong, Shanghai, Zhejiang, Jiangsu and Fujian – which represented nearly 60% of mainland visits to Macau in 2019.
- Reuters with additional editing by Jim Pollard