Wynn Macau said<\/a> <\/em><\/strong>in a recent business update that disputes between the China and US over trade policies and practices \u201cmay curb certain transactions.\u201d<\/p>\n\n\n\nIn particular, Wynn Macau fears that the US’s recent ban on the Chinese messaging application WeChat may impact its communications with the VIP market that it’s relying on for recovery. <\/p>\n\n\n\n
It said the app \u201cis widely used by many of our customers\u201d, and added \u201cthere is no assurance that the ban will not adversely affect our ability to communicate with certain of our customers.\u201d<\/p>\n\n\n\n
Wynn Macau also mentioned that volatility in international markets created by China-US tensions \u201ccould trigger a severe contraction of liquidity in the global credit markets.\u201d The company feared its \u201cbusiness and prospects may be negatively impacted\u201d as a company in the SAR majority owned by a US firm.<\/p>\n\n\n\n
Song said the US government had confirmed US companies can continue to use WeChat in China.<\/p>\n\n\n\n
She added: \u201cFor the license renewal, we believe that key areas when the government is deciding will be the casino operator\u2019s contribution to the overall good of Macau\u2019s economy and society, as well as the amount of effort spent in developing non-gaming elements, which will help the Macau economy diversify away from gaming.\u201d<\/p>\n\n\n\n
Warwick Bartlett, CEO at Global Betting and Gaming Consultants (GBGC), is less confident that things won\u2019t get more complicated for casino operators with the US so close to elections. <\/p>\n\n\n\n
He told Focus Gaming News: \u201cBeijing will not wish to be seen to losing face in the negotiations, and the White House in a democracy where votes have to be won, will want to be seen doing something.\u201d<\/p>\n\n\n\n
Bartlett believes this \u201cshould be a concern to the gambling industry\u201d since the sector is in danger of becoming a \u201cscapegoat\u201d in whatever negotiations take place.<\/p>\n\n\n\n
As for the 2022 tender, GBGC’s CEO stressed that Covid -19 has caused the Macau government to lose a lot of tax revenue. As a result he believes it likely that Macau will impose either an increase in the license fee or a rise in taxation.\u00a0<\/p>\n\n\n\n
\u201cThe cards are stacked against the operators in that negotiation\u201d he said, and added: \u201cif the US and China negotiations turn sour, then silly tit-for-tat policies rather than pragmatic solutions could rule, and that might not be good for the gambling industry.\u201d<\/p>\n\n\n\n
David Green, principal at Newpage Consulting, fears the same result. He told Focus Gaming News Asia Pacific: \u201cMacau will not make a decision to award new concessions without the blessing of the central government in Beijing. <\/p>\n\n\n\n
“Given the tit-for-tat measures taken by both the US and PRC in their dispute to date, it is conceivable that the three concessions associated with US interests could be at risk.\u201d<\/p>\n\n\n\n
The expert, who is a former gaming advisor to the Macau SAR Government, added that only Wynn Macau was granted a concession as a result of the initial 2002 liberalisation process, while MGM and Sands China were admitted by way of sub-concession. <\/p>\n\n\n\n
He said Law 16\/2001 refers to only three concessions and that unless the number is increased to six or more, one or more of the sub-concessions could be at risk of terminating by expiry and not being renewed.<\/p>\n\n\n\n
The conflict, warns Green, goes further than commerce, so \u201cthe gravity and likelihood of the risk crystalising\u00a0may turn on the result of the US Presidential election in November.\u201d\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0<\/p>\n\n\n\n
Ben Lee, managing partner of IGamiX Management and Consulting also considers the main risk is the economic fallout that could be an unwanted consequence of the trade war between the two nations. He believes there is \u201ca rising possibility\u201d of US operators not getting their licences renewed in 2022.<\/p>\n\n\n\n
Green foresees there could be a requirement for greater local ownership, which currently set at only a minimum of 10 per cent equity in a concession-holding company.<\/p>\n\n\n\n
He added: \u201cvisas could also be withheld for more foreign executives, in order to create more opportunities for locals, a term which includes PRC residents.\u201d<\/p>\n\n\n\n
Song on the other hand, believes such a scenario is unlikely given the contribution to Macau’s economy made by Sands China, Wynn Macau and MGM China. <\/p>\n\n\n\n
The Morningstar analyst said: \u201cthe government is unlikely to terminate its licenses and ruin the confidence of integrated resort operators. Should that happen, business confidence in entering and investing in Macao would plunge.\u201d<\/p>\n\n\n\n
She noted the pipeline of investments US-based companies have in place and how a decision not to renew their licences could impact on those projects. <\/p>\n\n\n\n
She said: \u201cMGM opened MGM Cotai in 2018, and some development projects, such as South Tower suites, still continue; Sands\u2019 Londoner project is going on; Wynn also has the phase 2 project of Wynn Palace the Crystal Pavilion, which targets to complete in 2025. <\/p>\n\n\n\n
“We think these actions show the casino operators\u2019 confidence in Macau\u2019s overall regulatory and economy outlook.\u201d<\/p>\n\n\n\n
According to Song, the worst likely consequence geopolitical events could cause operators could be some incremental costs associated with the license renewals. <\/p>\n\n\n\n
She said: \u201cWhile costs might be incrementally higher, licences [will] likely get renewed.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
Experts analyse the risk of volatility and the \u201crising possibility\u201d of Macau not renewing US operators’ licences in 2022.<\/p>\n","protected":false},"author":2,"featured_media":10029,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"is_press_release":false,"is_interview":false,"is_opinion":false,"focusai_summary":"Escalating US-China tensions are creating significant volatility and risk for US-owned casino operators in Macau, particularly concerning the 2022 B2C license renewal process. Concerns include the impact of a potential WeChat ban on VIP communication, China's capital flight campaign targeting cross-border gambling, and increased scrutiny on junket services, all posing substantial operational and regulatory challenges.","focusai_entities":"Sands China, Wynn Macau, MGM China, TikTok, WeChat, Morningstar, Focus Gaming News Asia Pacific, Global Betting and Gaming Consultants (GBGC), Jennifer Song, Warwick Bartlett, Donald Trump","focusai_location":"Macau, US, China, Washington, Beijing, Cambodia","focusai_target_profile":"ceo_executive (1.0), regulator (0.9), compliance_legal (0.9), operator_casino (1.0), tech_data (0.7), marketing_crm (0.9), payments_fraud_aml (0.9), investor_analyst (1.0), supplier_vendor (0.7), journalist_researcher (1.0)","focusai_suggestions":[{"label":"Macau License Renewal Strategy?","query":"What specific non-gaming diversification efforts are Macau operators undertaking to strengthen their 2022 B2C license renewal applications amidst geopolitical pressures and evolving governance frameworks?"},{"label":"Junket Compliance Mitigation?","query":"How are US-owned Macau operators mitigating the operational and compliance risks associated with China's capital flight campaign and increased junket scrutiny for AML and illicit money outflow?"}],"footnotes":""},"categories":[157,161,16338,158],"tags":[12436,227,2319],"class_list":["post-10026","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business-news","category-daily-news","category-east-asia-news","category-slider-home","tag-casinos","tag-china","tag-us"],"_links":{"self":[{"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/posts\/10026","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/comments?post=10026"}],"version-history":[{"count":6,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/posts\/10026\/revisions"}],"predecessor-version":[{"id":10152,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/posts\/10026\/revisions\/10152"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/media\/10029"}],"wp:attachment":[{"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/media?parent=10026"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/categories?post=10026"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/tags?post=10026"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}