Analysts at JP Morgan Securities said the casino licences renewal after June 2022 could involve committing certain budgets for non-gaming projects in the city.<\/p>\n\n\n\n\n\n\n\n
Macau.- Macau’s current casino licences will expire in June 2022 <\/strong>and a new open tender process would be conducted in the medium term.<\/p>\n\n\n\n However, analysts at JPMorgan Securities believe the public tender may involve bidders “voluntarily” committing “certain budgets for non-gaming projects in Macau and\/or Hengqin” and “social responsibility”.<\/strong><\/p>\n\n\n\n In 2020, Chief Executive Ho Iat Seng <\/strong>confirmed plans to invest MOP400billion (\u20ac46billion) in expanding into the neighbouring Chinese island<\/a>, Hengqin.<\/p>\n\n\n\n Over the years, several Macau casino operators have pledged to develop a non-gaming industry in Hengqin. <\/p>\n\n\n\n Sands China<\/a> even spoke in favour of Macau\u2019s project to invest in Hengqin Island. <\/p>\n\n\n\n It said in a press release that it “is privileged to be making contributions to the\u00a0economic diversification of Macau<\/strong>\u00a0and the development of the city into a world centre of tourism and leisure”.<\/p>\n\n\n\n Last year, Hengqin was designated a special zone by Chinese authorities to help diversify Macau’s economy and move away from its reliance on gaming.<\/p>\n\n\n\n The Guangdong-Macau cooperation zone in Hengqin will be focused on\u00a0technology and high-end manufacturing<\/strong>, traditional Chinese medicine, tourism and MICE as well as finance.<\/p>\n\n\n\n According to Amanda Cheng and Livy Lyu, analysts at JP Morgan, if casino operators are asked to support Hengqin plans “this would indirectly lower operators\u2019 return on invested capital to some extent”.<\/p>\n\n\n\n GGRAsia revealed JPMorgan noted that this potential for lower returns on capital during the pandemic is separate from any uncertainty in Macau visitor numbers and casino gross gaming revenue (GGR).<\/p>\n\n\n\n But the agency added on the regulatory outlook that bidders could face: “We think major disruptions, such as licence losses or tax hikes, are unlikely”.<\/p>\n\n\n\n JPMorgan noted that these things were not mentioned in the summary report of the recent public consultation<\/a> to revise Macau’s gaming regulatory framework.<\/p>\n\n\n\n The Macau government has said it will update the gaming regulatory framework ahead of a public tender for new Macau casino rights.<\/p>\n\n\n\nMacau publishes plan for economic diversification<\/h2>\n\n\n\n