Macau: The Future Entertainment Capital of the World?
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Case Code: ECON024 Case Length: 19 Pages Period: 1999-2007 Pub Date: 2007 Teaching Note: Not Available |
Price: Rs.300 Organization : - Industry : Miscellaneous Countries : Macau SAR, China Themes: Economics and Politics |
Abstract Case Intro 1 Case Intro 2 Excerpts
Excerpts
The Transformation of Macau
In the months preceding the handover, unlike the people of Hong Kong who were apprehensive before China took control of the territory, the people of Macau were in a celebratory mood. Press reports said that Macau residents were optimistic that the Chinese authorities would take drastic measures to check the growing power of the underworld. They were also sure that Beijing would want the transition to be seen as a success, to show Taiwan the benefits of rejoining the mainland. On December 20, 1999, Macau became a SAR of the PRC. At the time of the handover, the gaming industry contributed almost 50% of the government's revenues and 30% of Macau's gross domestic product (GDP), and employed more than quarter of the workforce. Post-handover, China implemented the policy of "one country, two systems" in Macau. In May 1999, Edmund Ho Hau-wah (Hau-wah) was elected as the first chief executive of the Macau Special Administrative Region by the 200-member Chief Executive Selection Committee appointed by the Chinese government...
Challenges
While Macau's gaming industry was growing by leaps and bounds, analysts worried about the long term impact of gambling on Macanese society. For example, the number of students leaving school to join the gambling industry was increasing, as salaries at the casinos were higher than what university graduates usually earned...
Looking Ahead
Macau has come a long way from being a non-descript Portuguese colony to becoming the largest gambling center in the world. In 2006, 22 million tourists visited Macau and according to a Goldman Sachs estimate, tourist arrivals to Macau would reach 45 million by 2009. With another 30 casinos opening by 2010 (Refer Exhibit VIII for the proposed casinos in Macau), estimates indicated that revenues from casino gaming would increase to around US$ 13 billion by 2010, from $5.5 billion in 2005. Much of this growth was expected to come from the large casino resorts that foreign operators were developing...
Exhibits
Exhibit I: Macau on the Map
Exhibit II: Places around the World* where Gambling is Legal
Exhibit III Additional Information on the Three Concessionaires
Exhibit IV: A Model of the Proposed Cotai Strip
Exhibit V: Social Indicators of Macau in 1999 and 2007
Exhibit VI: Las Vegas: From Sin City to a 'Regular' City
Exhibit VII: Revenues from Macau's Gaming Industry
Exhibit VIII: Proposed Casinos in Macau
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