The casino industry must adapt: CE
We [have seen] three licenses [separated] to six, we can’t afford to license all satellite casinos,” Chief Executive Ho Iat Seng said while replying to lawmaker Ron Lam’s question regarding economic revival plans.
Lam asked the head of the government for specific plans and timetables so that small and medium enterprises would have time to prepare in advance.
Commencing his reply, Ho spoke on economics, saying that, as he has observed, the city has experienced two major economic downfalls in recent decades, namely the Asian Financial Crisis in 1997 and the Global Financial Tsunami in 2008, besides the current hit, which started in 2020.
“The three incidents were each 12 years apart,” Ho highlighted. “In 2013 and 2014, our economy was at its peak, then it went down.”
The head of the government asked the public to be confident that a recovery is on the horizon, given the previous economic cycle, the information he obtained from mainland expert epidemiologists and current epidemiologist data from abroad, specifically the milder symptoms associated with the Omicron variant of SARS-CoV-2.
He even restated his confidence in Macau’s recovery in his nearly 15-minute answer.
To support his claims, he cited international rating entities that had retained Macau’s relatively high ratings. The ratings, he remarked, are strong pillars from the perspective of the banking and financial industries.
Meanwhile, the government’s financial prudence has led to rigid and careful disposal of income.
Suddenly, he changed the subject and started blaming some casino operators for committing “foul acts, which have affected the industry’s healthy development.”
The situation of the “satellite casino,” non-legal referral to casinos located on properties not owned by licensees, has rocked the city recently. The casino at the Grand Emperor Hotel announced its closure in June.
The need to “correct” the situation comes from the fact that the model is not legal, he said, emphasizing that the original law stipulates that the casino must be owned by a licensee.
He believes that the acquisition of these casino areas should not be too difficult because it only concerns gambling areas but not supportive elements, such as back-of-house. He also believes negotiation and cooperation will be able to solve the problem.
On the matter of junket operations, the head of the government stressed that it has not forced these businesses to close. It is only proposed in the draft amendment that junkets should be licensed so as to avoid complications and troubles.
He said that junkets may operate even after the draft amendment becomes law in the future. However, these VIP gambling rooms can only derive income from commissions. The existing practice that some have adopted, involving taking a cut from the debtors’ winning bets, should be eradicated.
“Current law prohibits this practice. What is worse is that gamblers are betting both on and off the table [side betting], which leads to tax evasion and money laundering,” he said. “I believe all present today do not and should not support these illegal acts.”
Lawmaker Angela Leong is a manager of the SJM Resorts, S.A.
Ho added that the Gambling Law must be amended according to the mainland law that governs gambling activities, unless Macau wants to constrain its development.
