Gaming Industry in Macau

Gaming Industry in Macau

When most people think of Macau, the first word that would come to their mind might be “Gaming”. Gambling tourism is the pillar industry of Macau. In 2006, Macau has replaced Las Vegas, and became the world’s largest casino market. (Macau’s, 2007) Last year, the gaming revenue of Macau is even 7 times bigger than that of Las Vegas. (Macau’s, 2014) From the facts that the Macau gaming industry is booming, obviously, Macau is a place suitable to develop gaming industry. But meanwhile, it’s also facing challenges.

Geography

Macau, located in the southeastern part of China, is a tiny area with only 29.9 square kilometers (after land reclamation). Though lacking in land resources, Macau has the advantage of good geographic position. It locates only 45km away from Hong Kong and 145km far from Guangzhou. It also borders on Zhuhai Special Economic Zone. Moreover, Macau has rich tourism resources. All these natural conditions determine that Macau is not suitable to develop agriculture or the secondary industry but an ideal location to develop the tourism industry.

However, if Macau purely develops the normal tourism industry, it may have been totally overshadowed by its neighbor Hong Kong. As special administrative regions, Macau has similar city functions with Hong Kong. In order to differ from Hong Kong and attract more tourists, it would be a wise choice for Macau to develop gaming industry.

History

Macau has a long history in developing gaming industry. Compare to other Asian cities that allow gambling, such as Singapore, Malaysia and Korea, Macau has a much longer history in gaming industry. The origin of Macau gambling can date back to the second half oh the nineteenth century, when the government legalized gambling in Macau for the purpose of improving revenue. Then later in 1962, the STDM was given the one and only gamble license. The STDM brought in western games and attracted millions of gamblers from both local and Hong Kong. (Chan s. s, 2000) In 2002, the Macau government liberalized gaming industry. And in 2006, Macau has surpassed Les Vegas, became the biggest gambling center in the world. Today, there are six casino operators and 35 casinos in this tiny city. The gaming industry has been well-developed in such a long time. In other words, to some extent, the modern history of Macau is the rise of a gambling city.

Economy

As mentioned above, the unique conditions of Macau, geographically and historically, influence Macau’s economic structure. The booming casino business boosts the local economy, increases the government revenue and improves the living standard of the locals. Last year, Macau’s gambling revenue rose 19% to $45.2 billion and it contributes more than forty percent of Macau’s GDP. (Kate, 2014) And gambling tax makes up seventy percent of the government’s tax revenue. (Bloomberg, 2007)

However, depending too much on gaming industry will increase the instability of Macau’s economy. Therefore, Macau is also facing challenges in the sustainable development of gaming industry.