As casinos in Macao begin new licenses to operate in the world’s biggest gambling hub as of Jan. 1, the stakes are high on whether they will be able to successfully deliver on a government mandate to diversify away from their cash-cow: gambling.
For the past 20 years, Sands China, Wynn Macau , MGM China, Galaxy Entertainment, and SJM Holdings have raked in billions of dollars from their casinos in the Chinese special administrative region, turning the once sleepy fishing village into a glitzy boomtown.
But their 10-year, shortened contracts come at a time when COVID-19 restrictions have decimated Macao’s gambling revenues, with 2022 the worst annual performance on record. Industry net debt is surging and operators face a new era of government oversight and control over their operations.