THE M3: SJM GAMING FORECAST; IMPORTED LABOR RULES INSIGHT; WYNN INTERVIEW; GDP UP 30%;

The Macau Metro Monitor, June 1st, 2010

 

HIGH EXPECTATIONS macaubusiness.com

According to Ming Pao Daily, SJM's CEO, Ambrose So Shu Fai, expects overall gaming revenue in Macau to exceed MOP 150 billion (~30% YoY).  This would imply a slowdown in GGR for the latter half of the year.  SJM’s capital expenditure will be MOP800 million this year.

 

NO ONE HAPPY macaubusiness.com

Several points to note about the new imported laborr regime:

 

1) According to the coordinator of the executive committee of the Standing Committee for the Coordination of Social Affairs and the head of DSAL (Labour Affairs Bureau), Shuen Ka Hung, the ratio of imported to local workers varies according to the "actual conditions" of different companies.

 

2) For now, the government has announced that croupiers, professional drivers, and floor supervisors are local-only jobs.

 

3) Employers are required to pay a MOP200 monthly fee for each non-resident worker hired.  But the manufacturing industry will only need to pay 50% of the levy. There were 73,932 non-resident workers in Macau at the end of February

 

4) Dormitories provided by employers to imported workers, are also obliged to comply with a clear minimum set of health and living conditions (usable area of no less than 3.5 square metres, bed per head, fans, bathroom equipped with a hot/cold shower facility and a washing machine for every 8 imported workers). If housing isn't provided for workers then employers must provide a housing allowance of MOP500/ month/ employee.

 

The construction sector is known to have the worst living conditions for workers. For example, just days before the new regime came into effect, the DSAL led a raid targeting Galaxy Macau’s construction site and found a complex of illegal dormitories for around 800 imported workers.

 

5) Because of higher costs, employers are not happy with the new regime. Employees are also wary because they do not want the changes in imported labor rules to depress wage rates for local workers. The Federation of Trade Unions of Macau (FAOM), the largest worker's organization in Macau, is studying a proposed minimum wage rule that would prevent cheap imported labor.

 

CHASING THE DRAGON macaubusiness.com

In an interview with macaubusiness reporters, Steve Wynn mentioned regarding the Cotai project, he "wouldn't need any more tables than (what he has) in Macau." Currently, Wynn has around 400 tables in Macau.  Wynn said that if the government maintains its 5,500 table cap beyond 2012, he wouldn't build the hotel/casino on Cotai.  Meanwhile, Wynn has revealed that he refused to work with seven junkets because they failed a compliance examination.  “Every 90 days at our board meeting, Governor Miller, who is the head of our compliance committee, [presents] our latest report...We conducted fifty three investigations of junket operators, forty six of those junket operators were found acceptable and seven were not,” Wynn said.

 

GROSS DOMESTIC PRODUCT (GDP) FOR THE 1ST QUARTER 2010 DSEC

GDP for 1Q 2010 rose by 30.1% in real terms, up from 27.4% growth in 4Q 2009. Gross gaming revenue soared 57.1% YoY in nominal terms and total visitor spending (excluding gaming expenses) rose by 14.3% YoY.


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