Whether you are looking for a holiday from work or a tax holiday, Macau is the place! In fact, China’s Macau Special Administrative Region is the best place to mix business with pleasure… or to make “pleasure” into a profitable business! I am talking about the gaming industry here and everything that goes with it – luxurious hotel suites, gaming tables, slot machines, entertainment arenas and exotic shops. Macau has recently become the world’s largest gaming city, in terms of gaming revenue.
Casinos in Macau garnered more than US$10 billion in gross gaming revenue in 2007, according to figures released by Macau’s Gaming Inspection and Coordination Bureau. This represents a jump of almost 47% jump over the previous year’s figure. The Cotai Strip, which is thriving today on reclaimed land on the southern tip of China, has left the Las Vegas Strip far behind. With gambling being illegal in China, except in Macau, the region attracts a huge number of tourists from the Mainland.
In the last few years, significant venture capital has flowed into the region. Investments have helped global giants erected magnificent luxury resorts to attract tourists and gamblers. Macau now has about 30 casinos. Only recently MGM inaugurated its $1.25 billion MGM Grand Macau. Las Vegas Sands Corp’s US$2.4 billion Venetian Macao was also launched last year. This is Las Vegas Sands’ second resort in Macau, with Sands Macao already being in operating since 2004. Wynn Resorts Ltd’s Wynn Macau is present on the Cotai Strip.
There is widespread optimism surrounding Macau’s gaming prospects this year, which makes the region attractive for further investment activity. Macau is likely to continue to grow, albeit at a slower pace than in 2007, given the global economic concerns. Xinhua, the official press agency of the government of the People’s Republic of China (PRC), quoted Lau Pun Lap, member of the Legislative Assembly of the Macau Special Administrative Region (SAR), as saying that Macau could witness a slowdown in gaming revenue growth this year. Despite the deceleration, the region should be able to sustain a double-digit increase in gaming revenue in 2008, Lau added.
Macau’s booming casino gaming industry has been attracting hundreds of millions of dollars from investors across the global. And why not? With gambling being illegal in much of Asia, including India, Thailand and mainland China, Macau’s gaming industry is poised to remain robust for a long time to come. Casino operator A-Max Holdings has recently raised HK$2 billion for funding its move into the VIP segment of Macau’s gaming sector.
Apart from venture capital pouring into casinos and resorts, several related sectors, such as airlines and cruises, are also attracting heavy investments. Venture capital into Macau’s gaming industry may actually get a boost from the dearth of prospects in the West.
* For series, references are published in the last installment of the series.
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