In the past two decades, the semi-autonomous region of Macau has solidified itself as the world's most popular land-based casino destination. There's not a close second. In 2021, Macau's gambling industry is estimated to be seven times larger than Las Vegas!
The Macau region has a long and storied history of international influence. Going back to the 16th century and lasting well into the 20th century, Macau's economy was dominated by Portuguese traders. The port of Macau dominated regional trade until the middle of the 19th century when Hong Kong, located about 60 kilometres to the east, was developed by the British.
As the decolonisation movement swept through Asia in the second half of the 20th century, Macau and Portugal agreed to a 1999 transfer of administrative control to the People's Republic of China. After 442 years of Portuguese rule, Macau was ceded to the Chinese on December 20, 1999.
As part of the transfer agreement, Macau enjoys autonomy not afforded to other Chinese regions. Largely left to administer the territory themselves, Macau is free to pursue its economic system with minimal Chinese interference through 2050.
History of Gambling in Macau
Licensed gambling in Macau goes back nearly 200 years. In the mid-19th century, the Portuguese government authorised so-called "gambling houses". While this ushered in the first legalised gambling in Macau, it was still a very local operation that catered to wealthier people from the inland and sailors making port calls.
In the 1960s, all that began to change. In 1962, a group of Hong Kong and Macau businessmen created Sociedade de Turismo e Diversões de Macau. This organisation controlled gambling licenses, a mandate that it maintains to this day. In addition to regulating the market, the Sociedade de Turismo e Diversões de Macau partnered with ferry companies to provide increased transportation from Honk Kong to the casino district in Macau. By the mid-1960s, gambling already accounted for 50% of the region's economy.
The real breakthrough began in the early 2000s. With China granting economic autonomy, Macau quickly moved to liberalise their gaming industry. Established American brands like Wynn, Sands, and MGM applied for and received licenses to build new casinos in the territory.
Macau and the Future of Gambling
In the last 20 years, Macau has blown past historically dominant gambling locations like Las vegas to firmly establish itself as the premier gambling destination on the planet. With over 40 major casinos, Macau dwarfs the competition.
Two major infrastructure projects have helped fuel Macau's growth. Macau International Airport, which opened in 1995, brings over seven million visitors to Macau each year. Also, the Hong Kong–Zhuhai–Macau Bridge, a 55-kilometre long tunnel and bridge crossing, now affords a quick connection from Hong Kong to Macau via rail and automobile, shaving hours off the former land route.
The biggest threat to Macau comes from other emerging Asian markets. Places like Singapore, Australia, and the Philippines are seeing even larger growth than Macau these days. Of course, this needs to be understood in the context that those markets are small and significantly underdeveloped relative to Macau's firmly established position.