Smoking lounges are a go in Macau, but only if the health of casino workers isn’t put in jeopardy.
A committee composed of Macau Legislative Assembly members has—by a wide margin of 7-2—voted in favor of keeping smoking lounges on casino floors, rather than moving forward with a full smoking ban, Union Gaming Asia Securities said in a note.
A quick recap: In 2014, the government introduced a partial smoking ban that restricted smoking on casino main floors in the city state to airport-style enclosed smoking lounges away from gaming tables or slot machines. Smoking cigarettes in VIP rooms, meanwhile, are still allowed.
But there have been calls from Macau officials to put a full stop to smoking in all casinos—a plan that mirrors Beijing’s efforts to reduce smoking in public places in the mainland. That plan, however, was met with dissent from many casino and junket operators, who appealed for some wiggle room on grounds that the blanket smoking ban will be a fatal blow to Macau’s already slumping gaming sector.
And here we are today. Quoting local media reports, Union Gaming Asia said legislative committee members who supported smoking lounges in casinos “suggested that so long as smoking lounges aren’t detrimental to the health of casino workers the lounges should be allowed to stay.”
So far, the government’s Health Bureau has already approved 86 out of 155 requests for smoking lounges it received since two years ago—27 of which were registered casinos that have been allowed at least one smoking lounge each.
Union Gaming analyst Grant Govertsen believed the smoking issue will be put to rest until 2017, giving the operators “at least one more year of status quo.” Govertsen, however, stressed that there’s still a chance the government will push for a total smoking ban.
“The government, via secretariats who report to the chief executive, seems to remain committed to the concept of a total smoking ban (although the view has softened a little) whereby individuals who wish to smoke would need to go outside to the street to smoke,” Govertsen said.
According to the analyst, a full smoking ban is “significantly detrimental” to Macau’s GGR and the associated government tax receipts on GGR.
“Based on what we’ve seen in other jurisdictions, we would expect a full smoking ban across the entire casino floor (mass and VIP) to result in further GGR declines in excess of 5 percent,” Govertsen said.