At the conclusion of Macau’s annual “Golden Week” holiday boom on 6 October, smoking will be banned from the public gambling floors of the city’s casinos: 35 properties whose proximity to mainland China’s baccarat-mad millions generated revenues that surged 18 percent last year to surpass US$45 billion, a take equivalent to seven Las Vegas Strips.
The ban won’t apply to the private salons reserved for VIP play, the source of upwards of 65 percent of those revenues, and it appears the government’s final guidelines (these hadn’t been released as of this writing) will also provide plenty of wiggle room for operators to sequester their lucrative higher-limit cash tables in similarly styled “private” areas that will qualify as smoking.
Still, it’s a huge step—no gaming jurisdiction in Asia has attempted anything like it—and it’s coming in the midst of a worrisome four-month slide in gaming revenues which analysts now expect will depress 2014’s growth into the low single digits, the market’s worst performance since the global financial crisis.
It’s not the only thing in decline. The mood among casinos workers is also heading south, and they’ve taken to the streets on at least eight occasions this year, and with the threat looming of a strike during Golden Week, government is moving to isolate the leaders of the city’s first-ever labour movement with criminal investigations.
Macau, like Hong Kong, enjoys considerable autonomy as a repatriated “special administrative region” of the People’s Republic of China.
A week later, Chui, the son of a construction magnate and scion of one of the clans who dominate the city’s political and commercial life, was awarded a second five-year term by an electoral committee dominated by business elites that are mostly pro-Beijing.
But labour, unlike the pan-democrats, in not without clout. Numbers are on its side, for one thing. The government derives something like 80 percent of its revenues from the casinos, and the industry has grown to the point where it has outstripped the ability of the city’s adult-age population to staff it. Unemployment is running at 1.7 percent, one of the lowest rates in the world, and it was to mollify this straightened and potentially restive force that government has reserved croupiers’ jobs, the highest-paid unskilled jobs in Macau, for permanent residents as a matter of policy.
The downside of this is twofold: those same dealers will be in acute short supply beginning next year when the first of some eight new resorts under construction opens its doors; and thus their ability, if organized, to bring the giant gaming industry money machine to a halt is very real.
Smoking is one of the issues that has galvanized them. With collective bargaining not recognized under local law, unofficial trade unions have risen up to address it, along with complaints about salaries, benefits and policies regarding promotions. In the processed they’ve supplied precisely that organization that government and the industry fear.
At the same time, the smoking ban is arriving in a more problematic environment, operationally speaking, than it would have at almost any other time. The last several months have witnessed a dramatic fall-off in VIP play, a combination of Xi Jinping’s aggressive crackdown on corruption, declining property prices and tighter credit on the mainland, and a junket industry struggling with liquidity problems that are shaking out a lot of the smaller participants.
Mass revenue growth is still strong but since the spring the rate of it has declined by about half, mainly because the central government has gone after abuses in the visa system for travel through Macau to third countries, which is cutting into trips by gamblers (and junket agents), and because it’s also harder now to skirt currency-export limits in the wake of a scandal that proved a considerable embarrassment for Macau authorities earlier this year when it was revealed that large numbers of swipe devices tied to China’s popular UnionPay card were being smuggled in from the mainland to process phony purchases.
Chao, a 34-year-old single mother of two, is a founder of Macau Gaming Industry Frontline Workers and Forefront of Macau Gaming, grassroots advocacy groups that have led public protests this year targeting Sands China, Galaxy Entertainment Group, three against SJM, and the industry collectively. She became active, as she told Bloomberg, after tiring of working in an atmosphere so thick with cigarette smoke it made her ill. “I just couldn’t stop coughing. I was scared,” she said. “If I died, what would happen to my daughters?”
Chao’s fellow activists Ieong Man Teng, Lei Kuok Keong and Ung Kim Ip also have been summoned for questioning by police in connection with the August demonstration, and according to news reports, they have been informed they face the same charge—“aggravated disobedience”—for allegedly breaching a police cordon, an accusation they deny.
In classic Chinese fashion the families have not been spared either. Chao told Bloomberg she didn’t know she was in trouble until police phoned her elderly parents. “My father and mother were scared and were crying. They thought something had happened to me.”
No charges had been filed against her and the others, as of this writing. The investigation is reported to be ongoing.