After publicly endorsing Hillary Clinton in August, Jim Murren, Chief Executive Officer for MGM Resorts International, has now speculated that the presidency of Donald Trump could well hurt American casino interests in East Asia.
The self-avowed “lifelong Republican” expressed his concerns during a recent interview with The Wall Street Journal newspaper by stating that Trump’s controversial rhetoric on foreign countries could alienate key casino business interests in lucrative markets such as China and Japan.
“There’s no doubt that China and America disagree on many, many topics but there’s been a degree of respect,” Murren, who also serves as Chairman for the American Gaming Association, told The Wall Street Journal.
Las Vegas-based MGM Resorts International has interests in the MGM Grand and the MGM Casino Cotai via its MGM China Holdings Limited joint venture and also depends on foreign travel to the United States for significant portions of its business. Murren suggested that these enterprises as well as those of rivals Wynn Resorts Limited and Las Vegas Sands Corporation could come under pressure if relations between China and the United States sour.
However, analysts have declared that it is too early to predict what effect Trump’s election may have on casinos located in Asia while explaining that the result may even spur a boost in tourism to Macau from the mainland Chinese market.
“I don’t think there will be any direct impact, positive or negative, because Macau has far more ties to the Chinese economy [than the United States economy],” Grant Govertsen from Union Gaming Securities Asia told the Macau Daily Times newspaper. “Unless a real trade war breaks out between the United States and China or [we see] a serious decline in the value of the dollar [against other currencies], I don’t think there will be much impact.”
During his run for the presidency, 70-year-old Trump called on China to cease artificially devaluing its currency and analysts have even forecast that such a move could lead to an increase in the number of mainland tourists to Macau as visitors see their relative purchasing power increase.
“The relationship between the gaming industry and Macau is pretty insulated from China’s broader market so even if there are escalating tensions, the casinos in the region probably won’t be affected,” John DeCree from Union Gaming Securities Asia told The Wall Street Journal.