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MACAU BUSINESS
a gaming foothold outside of Macau and raise
Can you evaluate your gaming experience so far. your profile in the region?
What went as expected up until now and what
went wrong that you need to change drastically? I’m a big believer in gaming in Asia, it’s where the
growth is going to be in the next 20 years. We have
I keep an open mind because things usually don’t looked at all the jurisdictions that you can think of. I
happen as you plan in life. The very first [gaming know you know that we have a small slot machine
experience] was Mocha which we opened in 2003 presence in the Philippines and we had some
and nobody would have guessed and even I didn’t experience in Cambodia and Vietnam, none of it
think it would be possible to have such an pleasant. The first consideration that we look at when
overwhelming success. We grew from one tiny Mocha we go to these new places is political risk, country
in Hotel Royal with 70 machines into a chain of three risk and that’s why the smaller countries and
and that’s why we embarked on building Crown emerging markets are not worth it.
Macau and started developing the City of Dreams
and that’s when I brought in Crown Australia as a Like Cambodia, for instance…
partner.
When I first went to Crown in Australia I didn’t We got killed, we really got killed. We had ten slot
know anybody. I literally knocked on the door and clubs and over night, puff, they were gone…
asked ‘do you want to partner with me?’ Anyway, political reasons are very important. I still
Less positive experiences in terms of how remember four years ago James [Packer] and I went to
something unexpected goes bad was the Crown see Thaksin in Thailand. Who was to know that one
Macau opening. I don’t think anybody, including me, year later he would be a fugitive? So, political reasons
was ready to be so shocked by how bad that property are very important. I think the complexity with
opened because all the properties up until then Taiwan is its relationship with China and therefore if
opened pretty well. We opened empty, deserted and we don’t have the blessing from China to do
operated very poorly. something in Taiwan we wouldn’t, because first and
However, even more unexpected, was how suddenly foremost I am a Chinese person and both my father
we became the largest VIP gaming casino in the world and I are very loyal to Beijing and China and we have
for most of last year and even right now, we are in the invested so much money in Macau.
top two in terms of gaming revenue. That’s why I
always keep a very open mind and approach. I say How do you evaluate the first 10 years of Macau
that if you run into problems you should think of as a SAR? The good, the bad and the ugly?
ways out of them because the gaming industry
traditionally, I would say, is not very innovative. The good is if Macau didn’t bring all that foreign
capital and Edmund Ho didn’t open the industry the
Now that City of Dreams has become a reality is way he did I don’t think Macau would have developed
the sale of Altira a possibility? that quickly to be brutally honest. Because
competition drives people and that’s why when all
Not at all. It’s a rumor that people came up with that money came into Macau, it really drove it.
during the restructuring and when we changed the I think the first term was almost heavenly; it was
name, but that has never ever crossed our minds. We amazing from 1999 to 2004 and all that development
made US$165 million in terms of free cash flow out of in between. When I first started raising money for
Altira in 2008 and as I said early on, we have invested Melco to develop Mocha and for Altira I went to
380 million. So, in terms of return of investment that England and people asked me where Macau was and I
was magnificent. I designed Altira myself and I have a said it was that dot next to Hong Kong. People didn’t
lot of attachment to it. We are very proud to have a even knew where Macau was in 2003 and 2004. And
number of design awards, we won the award for best now the whole world knows where Macau is. There
pool, and we have been honored with a Michelin are a lot of achievements that this administration has
award in one of our Chinese restaurants. It’s made.
strategically important for us. We have one of the Now, the bad. Although it developed so quickly, the
most conservative balance sheets in all of Macau and infrastructures never caught up, even though they
we are not in need of cash. Also, I’m not certain, had some time to do it. The Ao Man Long incident
whether it be the Central or Macau Government, screwed up the pace. The road widening projects that
there is a desire for the casino companies not to they have planned, the light rail system that has been
start selling their assets, unless they are completely talked about forever… Come on, I still don’t know
forced against the wall. how a one storey structure takes longer to build than
the City of Dreams. These things, they could have
Asian growth done. With the tax revenues that they had before,
they could have done a little more. I think that’s the
You showed some interest in investing in bad. I don’t think there’s really an ugly side. The first
Taiwan, now that the island has begun the process term was amazing for the administration and the
of legalising casinos. How anxious are you to gain second term was just coming back down to reality.
14 JULY/AUGUST 2009
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