Honeymoon Period May Be Over For Casinos In Macau

Macau might not have been fully prepared for what has happened in the past ten years. Casino gambling has taken off in the area at such a rate that they have passed Las Vegas, Nevada, as the gambling capital of the world.

The growth was so rapid, however, that the honeymoon period may finally be coming to an end. While casino operators plan their expansion in Macau, revenue is beginning to decline.

Third quarter numbers that were released by the Macau Gaming Inspection and Coordination Bureau showed that revenue is down ten percent for the quarter. That translates into a decline of $3.2 billion from the previous quarter.

The global market meltdown has much to do with these declining numbers. It took Macau a little longer to feel the effects than the casinos in Las Vegas, but it is now is getting hit hard by the difficult economic times around the world.

"The credit crunch could delay project developments in the pipeline," wrote analysts Praveen Choudhary and Corey Chan of Morgan Stanley, in a research note. It is a few of the Las Vegas casino companies that are involved in the expansion in Macau, and those companies are now dealing with declining stock numbers.

The drop in stock will stall many of these expansion projects. Others, however, are still on track to being completed. "City of Dreams remains fully on target to open to the public during the first half of 2009," said Melcro Crown Entertainment in a statement.

October 21, 2008
Posted By April Gardner
Staff Editor, CasinoGamblingWeb.com
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