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MACAU By Luis Pereira, Macau Business
538,000, plays host to a staggering 30 million tourists a year. Most visitors are upper mid-
dle class Mainland Chinese traveling under the individual visa program.
L
as Vegas bites the dust: Macau is now the world’s new gaming capital. In just the Pros and cons aside, Macau has made a name for itself. Macau’s success has, arguably, set
first three months of 2008, Macau’s casinos generated US$3.71 billion in the likes of Singapore, Japan and other Asian jurisdictions onto the gaming tracks, either
gambling revenues, more than Las Vegas or the whole state of Nevada, Atlantic City following the new industry model set by Macau or steering well away from it. The bottom
and New Jersey put together. Receipts were fueled by high-end VIP baccarat rev- line is, whatever happens in Macau, either for better or for worse, will undoubtedly
enues – which represent close to 70 per cent of the overall receipts – up more influence the development of the industry, not only in Asia but all over the world.
than 52 per cent to US$2.5 billion compared with last year. At the time of going to print
Macau boasted 4,311gaming tables and 12,956 gaming machines spread throughout 30
casinos, 19 of which are operated by monopoly-era incumbent Sociedade de Jogos de
Macau, five owned by Galaxy Entertainment Group, two by Las Vegas Sands, two by Melco/
PBL, while MGM Grande Paradise and Wynn Resorts ran one property each. Due to open
later this year is LVS’ luxury hotel casino Four Seasons, adding an estimated extra 130
gaming tables, 400 slots and 210,000 square feet of retail space to the market.
Macau’s Cotai Strip is currently one of the busiest building yards with more then 12,000
hotel rooms under construction. Until the end of 2010, the city will host at least 10 brand
new casinos, one for each new property under construction, increasing by a whopping
3,000 new gaming tables plus an estimated 14,000 gaming machines, and almost
5,000,000 square feet of retail area on the side. The new properties will help boost the
upcoming local MICE industry which, contrary to ‘the other gaming capital’, Las Vegas,
makes up for only a very slim fraction of Macau’s total receipts.
High growth rates have also brought increasing challenges to Macau, so much so that the
government felt compelled to intervene in the free market economy by announcing the
development of a study for the sustainable growth of the gaming sector which will
introduce a limit on the number of gaming areas. Another regulatory measure was the
introduction of a fixed fee paid by operators to junkets and gaming promoters, capped at
1.25 per cent of the amounts brought to the tables. The Government has also decided to
close down the market to new operators wanting to enter the local market in the near
future leaving the current six license holders to compete among each other.
The other side to the coin is booming inflation and steep rise of consumer prices leading
to social unrest in the redistribution of wealth and forcing the government to give a
US$600 subsidy to every registered Macau resident. While Human Resources is by far the
biggest difficulty faced by new and old businesses, lacking infrastructure is also a big issue.
The the once sleepy Portuguese enclave, of 29.2 square kilometers and a population of
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