Reports MACAU MARKET
earphones in Vietnam a sign it is gradually relocating its supply chains away from China. As US trade with China dropped significantly last year, imports from Vietnam, Taiwan and Mexico increased.
According to a survey by analyst firm Gartner, more than a third of companies with global supply chains are moving or planning to move their activities out of China within the next couple of years.
Te rising tariffs imposed by Trump, plus Brexit issues are the main cause, whilst the Covid pandemic has merely added icing on the cake by highlighting supply issues
Tis shift in location is also driving Macau’s ‘bread and butter’ customers out from neighbouring Guangdong to Indochina. Macau’s VIP play is now drifting over to regional markets such as Vietnam and Cambodia.
Macau’s GDP fell by 4.7 per cent in 2019 to MOP434.7bn (US$54.2bn). Exports of gaming services fell by 9.8 per cent due to a decrease in VIP gaming business.
GGR generated by VIP play was down 18.6 per cent in 2019 although the mass market table gaming sector grew by 16.8 per cent resulting in a total GGR drop of 3.4 per cent in 2019 compared to 2018. Tax revenue was MOP112.7bn last year.
Macau’s Q2 exports of gaming services and other tourism services fell by 97 per cent and 93.9 per cent respectively (year on year) which saw a 67.8 per cent drop in the city’s GDP for the period
Te GDP growth rate fell by 48.7 per cent during the first quarter of 2020 and fell by 67.8 per cent during the Q2.
Meanwhile Trump recently issued executive orders to ban the Chinese messaging app WeChat citing security concerns. Te app is used by US gaming companies as a social media platform with 1.2 billion users worldwide and is particularly popular in China whilst international WeChat users are estimated to be between 100 and 200 million and on average around 19 million daily active users in the US.
Te ban is due to come into force from September 20 and basically will cut off communication with customers in China for the likes of Wynn, MGM and Las Vegas Sands severely causing a disadvantage compared to their non-US competitors.
It will ban US citizens and corporations from conducting ‘any transaction that is related to WeChat’. Trump’s order issued on August 6 will simultaneously also ban video app TikTok owned by Beijing based ByteDance, if the two apps are not sold by their parent companies.
P96 NEWSWIRE / INTERACTIVE / MARKET DATA
He wants an American company to own the apps. It’s an unprecedented move. WeChat is the overseas version of Weixin as it is called in China providing a range of services from instant messaging, video calls, book restaurants, order food and ability to send money to other users.
With the Macau casinos unable to advertise themselves in China their marketing relies heavily on social apps to contact clients and advertise their promotions. WeChat is also a popular payment option and many Chinese businesses favour WeChat over credit card payments.
Te Chinese have little choice but to use this app which is operated by Tencent. Te country’s communist rulers block access to other social media sites such as Facebook, Twitter and many foreign websites and online services.
With the Macau casinos unable to advertise themselves in China their marketing relies heavily on social apps to contact clients and advertise their promotions. WeChat is also a popular payment option and many Chinese businesses favour WeChat over credit card payments. Te Chinese have little choice but to use this App, which is operated by Tencent. Te country’s communist rulers block access to other social media sites such as Facebook, Twitter and many foreign websites and online services.
WeChat is permitted because the Chinese government surveys and censors content blocking any criticism of the Chinese government and other ‘sensitive’ subjects whilst data is flagged and stored. Tis happens with Chinese registered accounts but there have also been endless reports of blocked accounts or messages for those Chinese nationals now living outside of China sending messages back home.
With Te Trump re-election in November this could be undone if Democrat candidate Joe Biden wins and reverses this decision. In the interim it does, however, put the US operators in a difficult position.
Tis is all part of Trump’s escalating tech war with China. Te Chinese Ministry of Foreign Affairs firmly opposes the order saying the US is using state power to oppress non-American businesses.
Meanwhile as all forms of gambling in mainland China are banned (bar state owned sports
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