BEIJING (AP) — Macau has tentatively renewed the casino licenses of MGM Resorts, Las Vegas Sands, Wynn Resorts and three Chinese rivals after promising to help diversify its economy by investing in non-gaming attractions, it said on Saturday. the government.
The announcement is good news for landlords who have invested billions of dollars to make the former Portuguese colony near Hong Kong the world’s largest gambling center. But the requirement to spend on theme parks, music and sports is adding financial pressure at a time when revenues have plunged under virus restrictions.
Regulators will negotiate final terms before the licenses take effect on Jan. 1, chief executive Ho Iat Seng’s office said. A seventh bidder, newcomer Genting Group of Malaysia, received no license.
The territory of 700,000 people on a peninsula in the South China Sea is the most tourism-dependent economy in the world. It is under pressure from Chinese President Xi Jinping’s government to diversify into retail, entertainment and other industries and to reduce reliance on mainland players, its main source of income.
Applicants for the license promised to fulfill conditions, including “to explore overseas customer markets and develop non-gaming projects,” according to a government statement.
He gave no details, but TDM Radio Macau announced earlier that the winners are expected to invest a total of $12.5 billion.
Macau’s economy has contracted since virus restrictions that halted most tourist travel were imposed in 2020.
Chinese operators include SJM Holdings, part of the late Stanley Howhich had a four-decade monopoly on casinos until 2001.
The others are Melco International, run by Ho’s son Lawrence, and Galaxy Entertainment Group.
The decision to allow foreign casinos in 2002 brought a flood of money to Macau. The six licensees operate a total of 41 casinos.
Annual revenues from slot machines, dice tables and other games peaked at $45 billion in 2013, more than triple the level in Las Vegas. But it slipped after Beijing tightened controls on how often mainland players could visit.
In 2019, before the pandemic, gaming revenue fell 19% from the 2013 level to $36.4 billion. In 2020, it collapsed 80% to just $7.6 billion. Last year, revenue rebounded to $10.8 billion, but that’s down 75% from 2013.
In the last quarter, the economy shrank another third from last year’s depressed level due to virus checks imposed after outbreaks in June, the government said. He said gambling revenue fell by 72.5% and tourist arrivals fell by 50.8%.
Adding non-gambling assets would make Macau more Las Vegas-like. Casinos try to attract families and non-gamers with roller coasters, music, shopping malls, art exhibits and water parks.
SJM operates a zip line and indoor skydiving attractions. He filed a proposal for a Hello Kitty theme park. The mogul behind Galaxy talked about a possible “Avatar” movie-like theme park, but it never happened.