Economic Impact of Casino development in Macau - Baltimore Post-ExaminerBaltimore Post-Examiner

Economic Impact of Casino development in Macau

Macau has seen one of the most rapid economic growth of any region in the world over the last two decades. Also known as the “Las Vegas of Asia,” the little Chinese territory is the largest gaming market worldwide. The region has seen unprecedented economic and financial growth in recent years and now has a tourism and travel income to rival other tourists hotspots worldwide.

Macau’s economic success is largely down to its booming gaming market which attracts businesses and tourists from all over the world. Although public gaming and casino businesses have been legal in Macau since 1850, the industry only really took flight in 2002 after the government ended the monopoly of billionaire Stanley Ho who owned all Macau’s casinos prior to the government’s interference.

In the aftermath of the government’s ruling, “Western-style” gambling and casinos were introduced into the territory. The arrival of foreign investors has seen the region build some of the best casinos worldwide over the last 16 years.

Foreign businesses entering the Macau business scene opened the gambling market for competition and increased government tax revenue significantly. According to stats, gambling taxes make up about 78% of Macau’s government income.

Gambling tourism is now Macau’s biggest source of revenue, and accounts for about 50% of the economy, with casino revenue income already overtaking that of Vegas. The region sees an average of 30 million visitors every year, with a total of 32.6 million visitors in 2017, which was a 5.4% increase from the previous year.

Mainland China, Taiwan, and Hong Kong are Macau’s top three sources of visitors. The territory had about 870,000 Korean visitors in 2017, a 32% increase from the previous year, while Japanese arrivals grew by 9.4% from 2016. Visitors from the Philippines and Indonesia also grew by 7% and 8%, respectively.

Macau’s economy is uniquely inter-connected due to its reliance on tourism as its primary source of income. The overwhelming success of the gaming sector has seen the success spill into other areas of the economy as well.

Macau has an unemployment rate of just under 2%, which is a direct result of the thousands of businesses that have opened in the region since 2002.

Macau’s attraction to foreigners has transformed the business scene with the territory known for having some of the world’s biggest hotels, casinos, and restaurants. The end of Stanley Ho’s monopoly in 2001 saw some of Vegas’ casino operators enter the Macau market, with Las Vegas Sands opening the world’s biggest casino in Macau – Sands Macau – which employs over 1,000 people.

Other casinos like Venetian Macau, Wynn Resorts, and MGM Mirage are also responsible for employing thousands of indigenes. Macau’s hotel business also plays a significant role in the region’s successful economy, with over 75 hotels and 30,000 guest rooms open to visitors.

Most casinos in Macau (Sands Macau for example) are built in tandem with hotels and guest rooms which are owned by a single company that hires hundreds of people and earns millions for the government in taxes.

The ending of Ho’s stranglehold on Macau’s casino and games industry was a well-calculated decision as it has opened the floodgates to an endless stream of income into the country’s economy.

For such a long time Las Vegas seemed to monopolize gambling in the U.S and on the global stage as well, but the fact that Macau is now being compared to Vegas is a testament to their amazing economic growth over the last decade and a half.

Although the majority of gamblers outside Asia will favor the bright lights of Vegas, more and more investors are pitching their tents in Macau every year, and it might only be a matter of time before the arguments swing in Macau’s favor.





About the author

Karthik Reddy, Community Manager at www.16best.net, is the author of India’s Number 1 travel blog. Boasting an MBA in computer science, he once decided to get away from the office desk life and take a breathtaking journey around the world. He is eager to use the power of the global network to inspire others. A passionate traveler and photography enthusiast, he aspires to share his experiences and help people see the world through his lens. Contact the author.
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