As the Casino Industry Flatlines, Macau Tries to Reinvent Itself
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It seems like it was just yesterday that Macau was leaving Las Vegas and Monte Carlo in its dust and racing to the head of the worldwide gambling scene. Even as analysts were heralding its rise, a slowdown was brewing.
Macau still draws overseas visitors, many of whom see it as a more-exotic version of Vegas. However, most of the gaming income that funded the former Portuguese territory’s meteoric rise came from high rollers who crossed over from Mainland China.
Mainland gamblers are staying home
The Middle Kingdom is in the midst of a massive economic slowdown. Macau’s pool of potential whales is shrinking. You’d think that China’s super-elites would be immune to their country’s bursting bubble. Many are still doing OK, but they are staying away from Macau for another reason.
The PRC has been trying to clean up its image recently. A nationwide crackdown on corruption has put some of the country’s highest-flying officials behind bars. President Xi Jinping has vowed to continue these efforts, and both the international media and the Chinese populace have applauded the crackdown.
Few people are clapping in Macau, however. Afraid of being seen as free spending and decadent, China’s political and business elites have been staying out of the casinos, and avoiding the territory altogether.
What’s next for Macau?
Macau’s gambling revenue has dropped each month for the past 16 months. Even as Robert De Niro and Leonardo DiCaprio were cutting the ribbon on the multi-billion-dollar Studio City complex, a Hollywood-themed venue right in the middle of the Cotai Strip, Macau knew it was in deep economic trouble.
So what’s next? A lot of people have a lot of money riding on the success of Macau. Some of gambling’s biggest brands, the likes of Sands and Wynn, are heavily invested in the tiny territory. Some billion-dollar projects are still in the pipeline; they haven’t even broken ground yet.
Much was made of Macau surpassing Las Vegas in terms of gambling revenue. But now the struggling territory will look to the Nevada destination for guidance on how to reinvent itself.
Las Vegas has survived major slumps in the past. It has succeeded in giving itself a makeover more than once. Macau may take a similar strategy. It wants to foster a more family-friendly image and give casinos a smaller role in its tourist industry. Some of the planned projects will go ahead, but they will be more focused on including other attractions, and less focused on how to fit the maximum number of baccarat tables onto the gaming floor.
This process will undoubtedly take time, but it has worked in Las Vegas, and many of the same players are now involved in trying to make it succeed in Macau.
The other side of Macau
If you get away from Cotai, Macau is a totally different kind of tourist destination. Its Portuguese-tinged architecture gives it a charming quality that you won’t find in the casino areas. It has become a sort of melting pot, with people from all over the world (especially Portuguese-speaking countries) coming to try to cash in on the trickle-down opportunities. Because of its unique set of influences, you’ll experience an atmosphere here on the "other side of Macau" that you won’t find anywhere else in Asia.
More by Josh Lew
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