Photographer: Jerome Favre/Bloomberg

OPINION – New Year musings

The Macau economy’s health is strongly linked to tourism and, in particular, the gambling sector. That is well-known and understood, stating it became almost redundant. But it is probably necessary to reiterate it now and then, lest people forget the implications. 

Until the day that the so desired diversification manifests itself, this city’s fortune is essentially tied to that sector, literally and metaphorically. That link is the city’s strength and its weakness. As the new year starts, the omens are far from clear.

In terms of casino revenue, the final month of the year was the best of the year. I mean, the Covid year. Indeed, we do not ignore that January was the best month by far, but it belongs in every aspect but the calendar to another time, another era.  That the best month still represented just about one-third of the revenue recorded the previous year in the same month gives a measure of the blow. The data shows the full-year tally was only one-fifth of the 2019 value.

Meanwhile, the number of visitors is also a trickle of what it used to be. There are no indications that such a situation will change shortly. Even if the ‘target’ of 30,000 people a day is reached (figures for the last month are not yet published), it is well below the values we were accustomed to – which inevitably impacts all types of tourism-related activities, big and small, directly. 

There is no sign that things will improve significantly in the short term. The promise of vaccines, nonetheless, the authorities’ general mood seems stuck in a hyper-cautious Covid-only mindset. Other types of consideration seem to play little role. Visitors from China are comparatively strictly limited; moreover, their visit spending profiles may be changing. Connections to the rest of the world, including Hong Kong, are for practical purposes closed doors. 

These are dramatic figures by any standard. For all the buffers that Macau is fortunate to possess – non-resident labour force and accumulated savings in the booming age -, this situation is brewing a social and economic ruin. It does not take much science to conclude that a casino economy geared to earn five times its present revenue, and a city that accommodated ten times as many visitors, cannot survive in its current form for long. And a viable alternative is still not on the horizon.