Macao is shutting down all of its casinos in the race to stem the spread of Covid

The Grand Lisboa Hotel is in lockdown after Covid-19 cases were found there on July 6, 2022.

Guo Kai | Visual China Group | Getty Images

Macau closed all of its casinos for the first time in more than two years on Monday, sending gaming company shares tumbling as authorities struggled to contain the worst-ever coronavirus outbreak in the world’s largest gaming hub.

The city’s 30-plus casinos and other businesses will be closed for a week and people have been told to stay home, although short trips for essential services have been allowed.

Police will monitor the flow of people outside and impose severe penalties on those who disobey, the government said.

Although many casinos have effectively shut down with only minimal staffing allowed over the past three weeks, the more drastic measures have hit investor confidence hard. Some analysts predicted that a recovery in gaming revenue might not materialize until the end of Q3 or Q4.

“We would probably have to write July off the models and probably August as well,” said DS Kim, an analyst at JP Morgan.

Shares in Sands China slumped 9%, while shares in Melco International, Wynn Macau, SJM Holdings, Galaxy Entertainment and MGM China fell between 6% and 7%.

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Macau has recorded around 1,500 Covid-19 infections since mid-June. Around 19,000 people are in mandatory quarantine as the government adheres to China’s “zero Covid” policy aimed at stamping out all outbreaks, bucking a global trend to co-exist with the virus.

More than 30 zones in the city deemed high-risk are now locked down, meaning no one will be allowed in or out for at least 5 days. While the government has said it will not impose a citywide lockdown, the strict measures mean Macau is effectively shut down.

Casinos in Macau were last closed for 15 days in February 2020. The government was previously reluctant to close casinos under its job protection mandate. Industry directly and indirectly employs most of the population and accounts for more than 80% of government revenue.

Frustration with the government’s handling of the outbreak is growing. Fighting has broken out at testing centers, while some residents have had to queue for more than 20 hours to access health facilities.

Residents will have to take part in mass testing for Covid-19 four times this week. They have already been tested six times since mid-June and are supposed to carry out rapid antigen tests every day.

More than 90% of Macau’s 600,000 residents are fully vaccinated against Covid-19, but this is the first time the city has had to deal with the rapidly spreading omicron variant.

Authorities have added two hotels in popular casino resorts to be used as Covid medical facilities to boost capacity to deal with the wave of infections.

https://www.cnbc.com/2022/07/11/macao-shuts-all-its-casinos-in-race-to-curb-covid-spread.html Macao is shutting down all of its casinos in the race to stem the spread of Covid

Joshua Buckhalter

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