G3 MARKET INSIGHT MACAU


of governance and the geopolitical complexities of post-colonial Macau is required.


The constitutional principle of “one country, two systems”, makes Macau a Special Administrative Region of the People’s Republic of China and in 1999, the former colony of Portugal was handed over to the PRC and during the years following colonial rule the small peninsula in the Chinese Pearl River Delta witnessed an incredible economic transformation.


Gaming in Macau has long been an important economic driver, especially when placed in historical context with neighbouring Hong Kong outcompeting the peninsula thanks to its deeper trading ports. In the 1960s, casino tycoon Stanley Ho obtained the licence for the gaming monopoly replacing the incumbent, promising prosperity for Macau via tourism and gaming. Though it was not until the Handover that the newly appointed Chief Executive of Macau, Edmund Ho, decided to liberalise Macau’s gaming industry allowing foreign


Conflicting corporate cultures resulted in the split between Galaxy and Sands, a precedent which exposed the legal


sub-concessionaire loophole that enabled Wynn and SJM to sell their halves of their concessions to a Melco Crown joint venture and MGM respectively - further entrenching the role of foreign operators in Macau.


operators for the first time the opportunity to establish themselves in Macau.


Positioned favourably given that gaming was and still is outlawed in mainland China, the decision to open up the industry meant that SJM, Wynn Resorts (the sole US operator) and a joint venture between Galaxy Entertainment Group and Las Vegas Sands lit the touchpaper on Macau’s dramatic transfiguration into the world-leading gaming hub that it is widely known as today.


Conflicting corporate cultures resulted in the split between Galaxy and Sands, a precedent which exposed the legal sub-concessionaire loophole that enabled Wynn and SJM to sell their halves of their concessions to a Melco Crown joint venture and MGM respectively - further entrenching the role of foreign operators in Macau. The peninsula began to metamorphose and to make more space for the burgeoning industry Cotai soon opened, built on land reclaimed from the delta. However, this unchecked growth was soon to come to an end.


P30 WIRE / PULSE / INSIGHT / REPORTS


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