Macau is undoubtedly the world’s casino hub. This is evident from the great revenue generated from gambling in the city. The amazing architecture of the casinos in Macau is also one that is so attractive that tourists travel far and wide to experience gaming in the amazing casinos. Macau can easily be compared to Las Vegas only that it is way better now. The story of Macau dates back to when it was a Portuguese colony.
It was until 1999 when Macau embraced Chinese rules making it a unique administrative region. This means that the laws governing Macau are different from those in the mainland. Gambling in different cities in greater China is prohibited. Gambling is only legal in Macau and Hong Kong, which makes the country the best in gambling. According to our interaction with our expert, Victoria Oliveira, here are the factors that have contributed to Macau being the world’s casino capital
Globalization has greatly shaped the success of Macau. This is because prominent multinational companies have greatly invested in the casino industry in Macau. Revenue generated from Gambling in Macao is now a big fraction of the country’s overall GDP.
The economic state of China is also a great factor that has contributed to the success of the Macau casino industry. This is because the Chinese economy is on the rise, such that the citizens are economically stable, which means that they can travel and gamble comfortably in Macau.
Focus on VIP Rooms
The approach to gaming in Macau is different from other countries. This is because Macau focuses more on the high-end customers who invest heavy amounts of money in gambling. This has greatly influenced the rise of VIP gaming rooms. The VIP rooms which are set in a private setting, host high-end clients who play high stake games.
Casinos in Macau do not focus on the low staking customers but high-end customers. This has greatly increased casino revenue in the country. In a recent study conducted in 2013, it was estimated that the VIP gambling space accounted for 66% of total casino revenues.
Gambling is a key contributor of tax revenue to governments in any country. For instance, in Macau,40% of the total tax collected in 2001 was from gambling in the country. Ten years later, general gaming taxes accounted for 81% of the total collected tax. This was after the country decided to enlarge the casino industry by allowing foreign multinational firms to set up casinos in the country, just like what happens with casinos in Portugal.
Some of the online platforms featured on casinos Portugal online are also available in Macau. Before 2001 there existed only one licensed company that operated casinos. TheSociedade de Turismo e Diversões de Macau, SA (STDM) was a monopoly for close to forty years.
In2002, the government came up with an initiative that saw foreign and multinational agencies acquire licenses to operate casinos in the country. The multinational companies and agencies were mainly from the USA, Hong Kong, and Australia. They included Wynn Resorts, As Vegas Sands, and MGM Galaxy. The prominent companies embraced the idea, which made them invest heavily to create new casino complexes. The casino complexes came with amazing social amenities, including high-end hotels and state-of-the-art shopping malls. The casinos created many job opportunities for the citizens, which greatly influenced the economy.
Clear economic policies
The economy was further improved by the number of tourists who travelled far and wide to experience the thrill of playing in the casino. This greatly increased the tax revenue of Macau until 2014, when the then-Chinese president Xi Jinping formulated an anti-corruption campaign all over China jurisdiction.
The government started focusing on the high-end VIP gaming rooms as it was seen as a leakage point for China’s economy. It was believed that proceeds from corruption were being used to gamble in the VIP rooms. Gaming tax revenue declined from 84% in 2014 to 79% in 2017. This was because many gamblers stopped gambling from escaping the anti-corruption net.
Modern-day casino revenues are now stable thanks to the focus on the mass gaming market and not the VIP rooms. The government has now fully embraced gaming with many incentives to encourage foreign investors to come on board.