The Chinese Communist Party started the move of striking down the casino industry in Macau. Macau, which is China’s administrative region, is facing the heat of China’s Communist Party. Those supporting this crackdown mentioned that it is order to target “cross border inflow of funds for the gambling and other illegal methods.
The party recently announced different proposals which include increasing the number of casino inspectors to 459 from 192. Macau is the only region where gambling is active and legal.
The crackdown also affected the shares of many casinos in the region. The shares started crumbling for week’s right when the crackdown began.
On Wednesday, the stock market values of companies like Wynn Macau, Sands China, and Melco Entertainment plummeted by as much as a third.
The companies’ stock continued to plummet on Thursday, with additional losses of up to 13%. The downturn began when Macau’s secretary of state for economics and finance, Lei Wai Nong, announced a 45-day consultation period on the gaming sector, citing oversight issues.
Mr. Lei highlighted nine topics for feedback during a press conference on Tuesday, including the number of licenses, improved regulation, and employee welfare, as well as having government authorities monitors day-to-day casino operations.
In recent years, Macau’s government has tightened its oversight of casinos, cracking down on illegal financial transfers and unregulated loans. Authorities increased the number of gaming inspectors and made other steps to improve gambling sector oversight in June.
More Tightening Control
There will be more tightening control in the region towards casino curb and licenses to operate in the region. Companies which go against the government decision will face ban.
For gamblers, Macau is the vital region, just like Las Vegas. In 2019, region’s 141 casinos generated around $360 billion and also offer employment to around six lacs people.
This crackdown and curb in operation will effect employment and overall casino business in the region for long-term.
