COVID pandemic sees Macau gaming sectors value to the economy fall 80% in 2020: DSEC

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Macaus gaming sector saw its contribution to the local economy, calculated as Gross Value Added, fall by 79.6% year-on-year to MOP$41.85 billion (US$5.22 billion) in 2020, impacted by fewer visitor arrivals amid the COVID-19 pandemic.

According to information from the Statistics and Census Service (DSEC), the challenging year saw gross surplus of the sector, which comprises nine enterprises granted various concessions to operate gaming activities, decline by 87.9% to MOP$22.13 billion (US$2.76 billion). Gross Surplus Ratio, a measure of how effectively receipts are converted into surplus, fell by 26.1 percentage points to 36.1%.

With border closures and restrictions keeping business volumes subdued throughout the year, total receipts of the gaming sector in 2020 fell by 78.4% year-on-year to MOP$63.94 billion (US$7.98 billion), with receipts from gaming down 79.4% to MOP$60.32 billion (US$7.53 billion)and rental by 29.1% to MOP$38 million (US$4.7 million).

Total expenditure of the gaming sector fell 60.6% to MOP$46.42 billion (US$5.79 billion), including an 83.3% decline in expenditure on the purchase of goods, commission paid and customer rebates to MOP$9.43 billion (US$1.18 billion).

Operating expenses were also down by 68.8% to MOP$9.95 billion (US$1.24 billion), including a 74.5% reduction in the amount of spent on complimentary goods and services provided to customers to MOP$4.64 billion (US$579 million).

Compensation of employees went down by 12.5% year-on-year to MOP$19.71 billion (US$2.46 billion)although its share of total expenditure expanded from 19.1% in 2019 to 42.5% in 2020.

Despite the sector seeing its value to the economy decline it was still the primary source of revenue for the Macau government in 2020 with MOP$29.81billion (US$3.73 billion) in tax collected in 2020 comprising more than 70% of all tax revenue collected city-wide.