Macau casinos hit harder than Vegas. Macau, located on the southern coast of China and a one-hour ferry ride from Hong Kong, is the world’s largest legal casino destination by revenue, bigger.

The GGR (Gross Gaming Revenue) of Las Vegas is $6.4 billion, 34% of which comes from playing casino games. The rest comes from hotel rooms and restaurants. On the other hand, Macau has a GGR of $28.04 billion. Of this amount, the city will get around $12 billion, which is twice as much as Las Vegas earns in total. For March, Macau’s casino regulator DICJ reported gross gaming revenue of 25.84 billion patacas (MOP; US$3.23 billion), down 0.4% from March last year. Mass revenue, accounting for a solid.

The Macau government issued a total casino shut down for two weeks starting February 5, midnight.

Casino shut down in Macau

The Macau Government has issued a casino shut down on all its 41 casinos all over Macau. The shut down is expected to last at least two weeks after two new cases of the Novel Coronavirus have been identified within the local casino industry in Macau.

Macau Chief Executive Ho lat Seng announced the news during a press conference last Tuesday afternoon. Based on records, there are ten confirmed cases of the Novel Coronavirus in Macau.

Casino operators had a dialogue with the Secretary for Economy and Finance, Lei Wei Long. All 41 casinos and other gaming establishments are expected to be closed starting February 5, midnight, and will last for at least 15 days.

Controlling the spread of the Novel Coronavirus

The mandate by the Macau government is a pre-emptive measure to regulate the spread of the Novel Coronavirus in the area.

According to the Finance Secretary, all six gaming operators are willing to follow the government’s directive without compromising their employees’ rights.

The casino shut down does not include hotels, restaurants, and shops within Macau’s top tourist spot destinations.

Macau has been known worldwide for its Vegas-like casino lifestyle. Now that a suspension of operation has been issued, there are corresponding consequences that will affect the country’s revenue. But, the government believes that it is for the common good, especially when the health of the people is at risk.

As of now, the shut down was only imposed on casinos and gaming establishment. Macau’s borders are still open, and the tourists are still welcome to visit the country as they please.

The latest update on the Novel Coronavirus are as follows:

• 20,000 confirmed cases in China
• The death toll stands at 425 people
• Over 170 people are affected in more than 20 countries worldwide

Featured image by Casino.org

Macau is China’s answer to Las Vegas. But the former Portuguese colony has long surpassed the City of Lights as the world’s casino capital, with revenue from gambling receipts exceeding the entire state of Nevada back in 2010. As well as drawing in the punters, it has the glittering architecture to match.

The story of Macau is one of globalisation and the rise of China. It is a globalisation story because of the role played by foreign multinational casino companies. And it is a story of the rise of China because it has been the economic prosperity of its citizens that has allowed them in great numbers to travel, see the world, and gamble.

Macau returned to Chinese rule in 1999 as a special administrative region, which means it has different laws to the mainland. It is the only part of Greater China (which includes China, Hong Kong and Macau) where gambling is legal, making it the country’s sole gambling destination.

In the years before the 1999 handover, the environment in Macau was fraught, with organised crime a violent presence competing for access to the sub-contracted VIP gaming rooms. These VIP rooms, which host high stake games in a private setting, are another dynamic behind Macau’s success. They made the Macau gambling experience different from that of other casino destinations.

Macau’s focus on high-spending customers, with private rooms and special privileges – rather than mass market gamblers – is the source of much of the casinos’ revenue. Casinos were originally built around VIP rooms. These were sub-contracted to gambling promoters who shared in the profits from bringing in wealthy gamblers. These high rollers made up 66% of total casino revenues in 2013.

International investment

Casino operations generate substantial tax revenue for the government: in 2001 it was 40% of all tax revenue collected. Ten years later, government income from casino gaming taxes amounted to 81% of all tax revenue collected. This massive change is the result of the decision to open up the casino industry and invite foreign firms to compete for a casino license.

Until 2001, only one company was licensed to operate casinos and for four decades this was monopolised by a company called Sociedade de Turismo e Diversões de Macau, SA (STDM). From 2002, casino licences were awarded to several foreign multinational firms and joint ventures. This included big firms from Australia, Hong Kong and the US, with recognisable names from Vegas, such as Las Vegas Sands, MGM, Galaxy and Wynn Resorts.

Total Casino In Macau Grand

They invested heavily in big new casino resort complexes, with luxury hotels and high-end shopping malls. Given Macau’s tiny size – it originally consisted of a mainland peninsula and two small islands measuring 11.6 square kilometres in 1912 – land reclamation projects were necessary to host the burgeoning industry. By 2010, the territory measured 29.7 square kilometres, including six square kilometres of new land connecting the small islands of Coloane to Taipa, which plays host to the big casino complexes.

These new casinos have provided some employment opportunities for local citizens, but the greater impact for the economy has been the tourist visitor numbers and the tax revenue generated. After a decade of ever-increasing growth in gaming revenue with the opening of new casinos, tax revenue from the sector peaked in 2014 and then declined after China’s president, Xi Jinping instituted a widespread anti-corruption campaign.

The VIP gaming rooms in Macau became seen by the government in Beijing as a massive leakage of capital from the Chinese economy. A large part of the big money being gambled by these VIPs was seen as the proceeds of corruption and bribery on the mainland.

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In 2014, gaming tax revenue provided 84% of the Macau government’s total revenue; by 2017 it had declined to 79%. But these percentages conceal the decline in the actual amount available to the government, from US$20.1 billion in 2014 to US$15.7 billion in 2017. This is because a number of Chinese elites eschewed Macau’s casinos to avoid scrutiny during Xi’s corruption crackdown.

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Casino revenue now appears to have stabilised, helped by a move in Macau away from relying on the VIP sector and towards mass market entertainment. The government has also encouraged diversification beyond the casino gaming room and, like Las Vegas, it is looking to attract exhibitions and events to be held there.

Total Casino In Macau Casino

The new bridge connecting Macau with Hong Kong should support increasing tourist visits by easing travel to the territory, further supporting diversification. But Macau must increasingly contend with neighbouring rivals. The anti-corruption campaign encouraged Chinese gamblers to visit other Asian casino destinations, including new resorts in Singapore and Manila in the Philippines.

Modern Macau is built on China’s rise and the increased wealth of its citizens that this has brought. Macau’s continued success is contingent on its ability to attract the mass market gambler, along with other tourists, as a vacation destination. As China’s middle class continues to grow, it should guarantee a steady supply for years to come.