Macau’s gaming industry is undergoing a significant change as the local regulator, Gaming Inspection and Coordination Bureau (DICJ), has urged casino operators to stop offering free snacks to visitors. According to an analysis by investment bank Morgan Stanley, this move is expected to impact foot traffic to the casinos, but it is unlikely to have a substantial effect on gaming revenues.
The analysts, Praveen Choudhary and Gareth Leung, have pointed out that the new measure will mainly discourage visitors who are in the casinos solely for the free snacks but who do not participate in gambling activities. However, casino patrons holding a membership card with at least one reward point will still be able to enjoy complimentary beverages.
“We think this could hurt footfall to casinos but will only have a small impact on gross gaming revenue (GGR) since the new measure will mainly discourage visitors who are in a casino for free snacks but never gamble,” the analysts said. “Gamblers can still get free snacks easily.”
The crackdown on free snacks is also likely behind a decline in Macau gaming stocks of between 3% and 7% last week, according to the analysts.
The move comes as Macau’s gaming recovery has been driven by higher-end gamblers in the post-COVID era. “Mass GGR per Chinese visitation is 34% higher than 2019 in quarter one of this year,” the analysts noted.
The practice of “zero-dollar tours,” where mainland tourists would arrive on free shuttle buses to the casinos, pick up their free snacks, and then return to the border control points using those same shuttle buses, had become increasingly popular in recent years. However, the Macau government has cracked down on this model, and casinos are no longer allowed to provide free snacks and other complimentary services as freely as they once did. Staff Reporter
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