Two years ago, Macau was touted as the next big gambling hot spot as casinos raked in $7 million, surpassing those on the Las Vegas Strip. Now, travel restrictions and a worldwide recession has turned Macau’s boom into a bust.
At its peak, Macau was flooded with gamblers who crossed over by ferryboats from mainland China and crowded into Vegas-style casinos erected by the biggest U.S. casino operators – MGM Mirage, Wynn Resorts and Las Vegas Sands.
Now, many of those same casinos are running at only half capacity, construction has halted on new projects and thousands of casino workers are facing pay cuts in lieu of layoffs.
"From August onward, our customers have been reduced by half," Emily Chen, manager of Macau’s Seven Seas Travel Agency, told the Wall Street Journal. "Because most of the casinos here depend on mainland tourists, the money flows out continuously from China to foreign countries. That’s why the government wants to control it."
That governmental control has come in the form of travel restrictions that limit mainland residents to one trip to Macau every three months. Even non tourists, such as business operators, have had their allotment of monthly Macau trips cut from four to one.
Compounding the problem has been the effects of a global economy on the downswing. For instance, neighboring Guangdong province, once a big source of gamblers, has recently suffered factory closures and high unemployment, which has cut into those who could afford to travel and gamble for pleasure.
The resulting downtown in Macau’s gaming industry has pushed some operators, such as Sheldon Adelson and his Venetian Macau, to near bankruptcy.It has also put a halt to casino expansion and commercial development on the Cotai Strip section of Macau, where construction cranes now stand idle and 10,000 construction workers are off the job.
While the Chinese government has sought and succeeded in slowing down the flow of money to foreign companies, it is also experimenting with a lottery-type of game on the mainland, perhaps to help appease the citizens penchant to gamble.
But, they will probably find that gamblers may not want to play a horserace or lottery ticket, when there’s high-stakes, casino action just a few miles away in Macau.Related Articles:
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