‘An Empty Shell of What It Used to Be’: Asia’s Gambling Mecca Gets a China-Backed Makeover

November 8, 2022 China Earnings & Filings

Although the lights are still on along the popular Cotai strip, the throngs of people that used to pour in and out of Macau’s many hotels and casinos are no longer there. In the gambling capital of the world, many tables today sit empty, with entire sections of some casinos completely closed off due to lack of business.

This transformation has upended the lives of Macau’s residents. Groove Kuok, 33, has not had a full-time job in months. For seven years, he worked at a firm operating VIP gaming rooms in the city, where he earned around 40,000 patacas ($5,000) a month by analyzing clientele’s win rates. But last December, the company announced via WeChat that it was ceasing operations immediately. “It was out of the blue,” he tells TIME.

Kuok has taken a few side gigs, but now he’s attending IT skills courses to try to improve his chances of getting hired in an increasingly grim local job market: the percentage of unemployed residents has steadily increased to 5.5% from a pre-pandemic rate of 1.8%. He’s considering leaving Macau, as many others have already done in the last year, in search of work in other places in the Greater Bay Area—a sprawling southern Chinese conurbation comprised of nine major cities in the Guangdong province as well as the special administrative regions of Hong Kong and Macau—to be able to support his younger brother and mother.

COVID-19 battered the entire world’s economy, particularly places dependent on tourism. Macau, a popular gambling destination commonly referred to as “the Las Vegas of the East,” invited some 39 million visitors in 2019, including Chinese high-rollers. But Beijing’s harsh pandemic border entry and exit measures dashed Macau’s tourist figures to just 5.8 million in 2020, and a new push to diversify the semi-autonomous Chinese region’s economy away from gambling has not helped it to bounce back.

With gaming accounting for 80% of Macau’s tax revenue, China’s double whammy of an ongoing zero-COVID policy and a tighter regulatory grip on the local gambling industry has locals and experts worrying that the Macau that emerges from the pandemic may be a shadow of its former self.

Gambling is in Macau’s ‘DNA’
For a city occupying a tenth of Las Vegas’ land area at 32 sq. km. with only around 680,000 residents, Macau generated revenues six times that of America’s gambling capital before the pandemic. In 2019, it brought in $36 billion. Today, the industry’s monthly revenues are down to $300 million, compared to Vegas’ $659 million.

The former Portuguese colony’s history with gaming dates back to its founding as a trading post in the 16th century. Chinese immigrant laborers gambled as a pastime, with makeshift stalls for fan-tan occupying the city streets. Due to the popularity of gambling among workers, by 1847, Macau’s Portuguese government officially legalized gaming and taxed its revenues.

By: Chad De Guzman