A China cross-border embargo is set to hit an already struggling Genting Resorts World Malaysia. Under orders from President Xi, law enforcement agencies in China are to step up their efforts to prevent citizens from going overseas to gamble. Any non-Chinese citizen caught marketing or organising international gambling trips could face severe penalties including up to 10 years in prison.
The goal is to prevent money from flowing out of the country and into others such as Singapore that operate land-based casinos. Resorts World owners Genting Singapore has claimed that this embargo could result in far fewer Chinese VIPs at their resort.
After releasing their 2020 financial results which showed the resorts worst performance ever, Genting Singapore is now bracing itself for a year potentially worse. This news is predicted to hit the company hard as it relies on the annual influx of Chinese high rollers. And there is the pressure of support from the Genting NY project.
China Offering Immunity to Citizens Who Previously Gambled Abroad
In return for assisting the government close the net on foreign marketers and gambling organisations tempting Chinese gamblers to travel and gamble in other Asian countries, the government if offering immunity to those that have previously travelled outside of the country to gamble. So far, over 35,000 people have been charged with crimes relating to cross-border gambling.
They estimate that over $150 billion is moved out of the country each year because of gambling on foreign soil. Gambling is illegal in China, so gamblers only option is to travel to China-owned Macau or to other Asian countries where gambling is legal. Singapore, thanks to Genting two resorts, is one of the biggest attractions for Chinese gamblers.
Horrid Year for Resorts World
COVID-19 has been tough for many industries, and this is the same for casinos and resorts. 2020 was the worst year on record for Genting Singapore and the companies Resorts World Sentosa Resort. Profit was down 90% and gross gaming revenue also fell by close to 60% as the casino was closed during country lockdowns.
Genting Singapore has received aid and support from the Singaporean government to help weather the pandemic storm but even with this help, the company has struggled badly in the last year, as the casino has reported immense losses.
With this latest news and the continued effects of COVID-19 preventing global travel, it is not looking like getting much better in 2021. Genting Singapore will hope that the coronavirus outbreak comes to an end as quickly as possible so that some form of normality can return. Until then, things look bleak for the company for the rest of 2021.