Macau may benefit from China travel curbs: Sterne Agee

Monday 6th of March 2017

Macau may benefit from a March 3 decision by Beijing to restrict travel to South Korea, Sterne Agee said in a note.

South Korea accounts for 6 percent of outbound Chinese travel, after Hong Kong, Macau and Thailand. About 50 percent of foreign tourists to South Korea are Chinese and 40 percent come by tour package, the note said.

Recently, the China National Tourism Agency warned of travel to South Korea and large travel groups/agencies in China have taken down South Korea travel packages on their Web sites.

Mainland Chinese travelers may look to Macau and other destinations as an alternative to South Korea.

China’s travel warnings come on the heels of the announced installations of the THAAD US missile system, designed to protect South Korea from North Korea, but is looked at as a potential threat by China.

The news comes at a time South Korea’s gaming industry is reporting improving revenue, coming back from a 2015 slump, which was triggered by an outbreak of Middle Eastern Respiratory Syndrome. Tourism plummeted after the outbreak, which killed 38 people.

Last year, sales of lottery tickets rose 9.3 percent year-on-year to KRW 3.9 trillion, while Kangwon Land, the country’s only local-permitted casino saw KRW1.7 trillion in sales, up 3.8 percent year-on-year.

The Korea Racing Authority saw revenues up 0.2 percent to KRW 7.7 trillion in the year, while the Korea Sports Promotion Foundation saw cycling race sales gain 1.7 percent on-year to KRW 1.9 trillion.

Sales from foreigner casinos stood at KRW 20.5 trillion, surpassing the KRW 20 trillion mark for the first time.