Maccau city lights are an attraction for gambling fun.
The last time it was the year of the horse, Macau was a sleepy former Portuguese colony with a casino or two largely overlooked for its far more influential neighbour, Hong Kong. Becoming a 21st century gaming paradise since gambling was deregulated in 2002 has turned Macau from an unknown city to one of the world’s 20 richest economies in just over 10 years.
GDP is growing at over 10% per year and the unemployment rate is under 2%. Macau’s revenue has overtaken Las Vegas’ six times over in little over a decade and it is now considered the top gaming destination in the world. The question now is whether Macau can turn its gambling boom into a diverse and sustainable economy, or on the other hand, does it need to?
GDP is growing at over 10% per year and the unemployment rate is under 2%.
Two thirds of Macau’s visitors are from mainland China, where gambling is an integral part of the culture. Macau is currently the only place in China where gambling is legal and visitor numbers are getting up towards two million a month. But not everyone is happy. Local politician Jose Coutinho for one: “Macau is a complete illusion of prosperity because what we are building is only casinos, rooms and some shops with famous brands.”
Pretty much all investment in Macau at the moment is in gambling itself or in industries that support and complement the gaming industry, such as leisure, retail and entertainment. There is almost no thought of preparing for an alternative future in the event of a decline in gaming. But will there be a decline in gaming anytime soon, or even decades away? And would Macau be good at anything else?
Even if gambling keeps Macau prosperous for decades to come, there are still concerns. It is already the most densely populated place in the world and the rampant success of gaming has pushed up both wages and the cost of living to the point where any other type of industry finds it very hard to exist. Casinos offer higher pay and better working conditions, often including holidays, accommodation, meals and health insurance. Local businesses can’t compete with the incentives offered by the casinos.
Restrictions on the amount of foreign workers mean that there is still a high demand for locals and the lure of the high-wage-paying casinos is creating a new generation with only one skill, limiting them to life as a dealer, croupier or valet.
Two thirds of Macau’s visitors are from mainland China, where gambling is an integral part of the culture.
There are some attempts at a more diverse tourism economy occurring, with a no-gambling resort being developed nearby at Hengqin Island, with golf courses, theme parks and hotels aiming to offer a more family-focused vacation. Gaming operators in Macau are keen to see the development of Hengqin. They would like to see Macau become a centre for conventions, leisure, sport, entertainment and tourism, but with gaming still holding pride of place at the centre of it all.
Macau may have a monopoly on gambling in China, but it does face competition from other countries in the region who are trying to cash in like Singapore, the possibility of legalised gambling in Japan, specialist casinos for Chinese high rollers such as the one being built by James Packer in Sydney, and even the Chinese government’s testing of ‘cashless casinos’ in one of China’s other special economic zones.
But right now, as the Year of the Horse begins and the tourism numbers and gambling spend piles higher and higher, it’s a pretty spectacular time to be in Macau, with excitement and development everywhere, high incomes and a seemingly endless golden future. It’s a long way from the fishing village and textile factory of the last century and most Macanese are totally comfortable about that.