GAMING | Macau allure may fade as tourists go farther, Pansy Ho says
Macau is facing threats to its growth from China’s slowing economy and greater foreign competition, escalating the need for the world’s largest gambling hub to diversify from its casino gaming roots.
“I’d say the slowdown in the economy and the fact that now the foreign destinations might become competitors” are the biggest risks to Macau’s growth, Pansy Ho, co-chairman of MGM China Holdings Ltd, said in an interview with Betty Liu on Bloomberg Television in Hong Kong.
As Chinese tourists travel more frequently and farther afield, the city could gradually lose its appeal, said Ho, who’s nicknamed “casino queen” by local media. “We’re already beginning to see that the customers coming through our doors are more demanding, they now know how to differentiate.”
Chinese tourists have been powering the growth of Macau which leapfrogged the Las Vegas Strip in 2006 to become the world’s largest gambling hub. Casino operators such as Ho’s MGM China and Sands China Ltd. have added shops, restaurants and entertainment shows to draw mainland travelers as high-stakes gamblers cut spending amid a cooling Chinese economy.
Ho, whose father Stanley Ho held a 40-year gambling monopoly in Macau until 2002, is helping lead a drive to transform the city into a global tourism destination. The 51- year-old sees the need to cut the territory’s reliance on gaming halls that raked in USD45 billion of casino revenue last year.
The city has been affected by a slowdown in gambling growth in recent months as bettors cut spending amid a cooling economy and a nationwide crackdown on corruption in China. China’s President Xi Jinping’s clampdown on lavish spending has hurt sales of luxury goods such as Rolex watches and Prada bags.
Macau’s casinos have borrowed from other cultures to re-create features in the past and now mainland customers can afford to travel overseas to experience the original, “real things,” said Ho.
To draw more Chinese patrons, MGM China, the Macau unit of MGM Resorts International, has been adding local flair by playing up the Macanese and Portuguese influences at its properties, said Ho. Sands China competes with Italian singing gondolas and Galaxy Entertainment Group Ltd. with Parisian cabarets.
While Pansy is in charge at Shun Tak, her younger brother Lawrence Ho, whom she described as a “friendly competitor,” has gone his own way. He set up Melco Crown Entertainment Ltd. in a joint venture with Australian billionaire James Packer. “For me, I try to step out of my father’s shadow and do something on my own,” Lawrence said in a separate interview at City of Dreams, Melco’s biggest casino in Macau. “I’ve been trying to prove myself.”
“Lawrence really wants to grow his gaming enterprise beyond Macau and grow his portfolio,” said Pansy, his elder sister. “In my case, I’d like to really do more for the general well-being of Macau, promoting Macau as a destination.” Bloomberg
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