Macau to see positive shift in transit visa scheme

TAGs: Grant Govertsen, Jasmine Solana, Macau, Union Gaming

The government is poised to grant one of Macau’s wishes—the expansion of transit visa scheme.

Macau to see positive shift in transit visa schemeUnion Gaming Securities analysts are quoting multiple sources, who have reported that the city state’s transit visa scheme is about to undergo a significant positive shift by the end of 2015.

The current scheme allows a visitor to stay for seven days during the first visit of any given month and two days during the second visit of any given month, but under the new scheme, people entering Macau for purposes of transiting to a third party country would be allowed to stay up to 14 days during their first entry and up to seven days for a second entry.

Last year, the government restricted transit visas to five days during the first visit and one day during the second visit. Analysts believe it will be the VIP and premium mass segments that will benefit the most from any visa relaxation scheme.

“We believe it was the junket agents who were the hardest hit when the transit visa restrictions were put in place in July 2014 as agents would generally want to spend as much time in Macau as possible as they want to escort their customers for the duration of the customer’s trip,” Union Gaming analyst Grant Govertsen said in a note.

However, Govertsen believes the visa relaxation won’t have that much of an impact in the city state’s GGR.

“All the relaxation does is allow any given person to stay longer in Macau. It does not increase the frequency of visit to Macau. Therefore, in a market where the average length of stay is barely more than a day, the ability to stay 14 days instead of seven is unlikely to have a material near-term impact,” he explained.

Still, the analyst said the new visa scheme will “positively influence sentiment on gaming names.”


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