Macao Chief says no new casinos for near future - Thursday 1st of May 2008
Except for the existing casino projects, the government of Macao Special Administrative Region (SAR) will neither grant any new gaming concession or sub-concession nor approve any land for the building of new casinos in the near future, said the SARs Chief Executive Ho Hau Wah on Tuesday.
In light of Chinas central governments requirement and expectation for Macao to diversify its gaming-centered economy, the SAR government decided to tighten its gaming market regulation policy and maintain the current "three plus three" scale of the industry for the near future, Ho said, when attending a question and answer session of the SARs Legislative Assembly.
For the time being, the SAR government only granted three concessions to SJM, a gaming company controlled by local gaming mogul Stanley Ho, Hong Kong based Galaxy Casino S.A. and Las Vegas gaming company, Wynn Resorts, while three others, including two Las Vegas companies and one Australian one, were authorized to run casinos in the SAR under sub-concessions.
By far, there were a total of 29 casinos in Macao, with 21 casinos located in the Macao Peninsula and 7 casinos in the Taipa Island, according to the Gaming Inspection and Coordination Bureau of the SAR government (DICJ). Under relevant government regulations, local casinos were required to pay 35 percent of their gross revenues as direct tax to the government.
In addition to discouraging the expansion of local gaming industry, Ho also promised that none of the reclaimed lands approved in the future by the central government will be used for casino projects, and the government will require all of the slot machine halls to be moved out of the citys residential districts.
He added that the government will also make laws to regulate commissions paid to junket operators, and consider establishing a credential reviewing and licensing system for the members of casino management.
The governments decision to rein in the expansion of local gaming industry were welcomed by many lawmakers, but some still cautioned that indiscriminately freezing the land resources for all casino projects will create new problems in the industry.
Lawmaker Angela Leong said that the six licensed gaming operators significantly differ in terms of casino floor areas and gaming table numbers, therefore, the government should consider the specific situation and development strategies of each of these gaming companies so that they can all play fairly in the market. Angela Leong is also the wife of Stanley Ho who runs over half of the casinos in Macao.
In the first quarter of this year, the citys casino sector generated record gross revenue of 29.82 billion patacas (3.73 billion U.S. dollars), an increase of 62 percent year-on-year, according to the latest figures.
Meanwhile, the SARs Finance Services Bureau announced that between January and March this year, Macaos direct gaming taxes, surging by 52.7 percent year-on-year to 10.18 billion patacas (1.27 billion U.S. dollars), accounted for 78.1 percent of the governments total revenue.
The government do not have much choice but to rein in local gaming industry expansion, given many neighboring regions are all set to compete for a share of Asias booming gaming market, said local lawmaker Ng Kuo Cheong, adding that the gaming industry in Macao will soon come to an "adjustment".
He pointed out that Asian nations and regions such as Singapore and Chinas Taiwan were all preparing to open their casinos, which will definitely affect Macaos tourist arrivals, since Asian tourists, especially the ones from the Chinese Mainland, have more choice in deciding the destinations for their gaming entertainment.
Singapore ended a four-decade ban on casinos in 2005 amid surging gambling revenue in Macao, and the island nation planned to double the number of overseas visitors to 17 million annually and triple tourism revenues to 22 billion U.S. dollars by 2015 with the help of its new casinos that are currently under construction.
Local gaming tycoon Stanley Ho also admitted in a previous circumstance that the idea of investing in casino projects in Chinas Taiwan sounds interesting to him, but he believed the gambling ban there will not be lifted very soon.
"I dont think there will be any important casino projects in Macao next year," said Ng, adding that he believed the government has not much choice but to control the scale of Macaos gaming industry as the market saturates.
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