Albano Martins
Edmund Ho launched the liberalization of the gaming industry just after the transition.
Gaming revenues were almost insignificant in that time compared to today.
At the time, gaming was already the golden goose of this land.
Ho cleverly managed to make it grow exponentially.
From 2002 to 2004, real GDP grew by 10.1%, 14.2% and 27.3%.
Last year, gaming revenue in nominal values was something like 6.2 times Macau’s 1999 nominal GDP.
Ho’s great vision put Macau on the gaming world’s map and intelligently solved the problems facing the Macau economy.
But Ho was cautious and played it safe, playing within the rules and technology that he had at the time.
The control of capital flows and the guarantee that they come from suitable sources forced him to take the only possible option at the time: gambling in a casino and not online.
Macau did not have enough technology to engage, without danger, in another type of gaming.
With the liberalization of gambling, Macau now has a complex of casinos that are of world-class quality and multifaceted, supported by hotels, resorts and international standard facilities. They are prepared for the future and to be used by industries in the MICE area.
However, Covid-19 appeared when it was least expected and the gaming world shuddered!
The pandemic raised many doubts about an economy based only on this type of gaming, and above all on mass gaming.
It proved that it is necessary to add another dimension to this gaming model, that of online gaming.
In four months, the casinos lost something like 68 billion patacas in revenue and the Macau government almost 27 billion patacas in taxes on gambling. Not to mention the collateral damage it caused to the local economy.
It is therefore necessary to rethink gaming again.
Today, we are mature enough to add another segment to the Macau gaming sector that does not depend on the player’s physical presence: online gaming.
How shall we do this?
One solution would be for the six current gaming concessionaires to jointly take over this new gaming platform, so that they are “obliged” to jointly create a new society in the next concession contracts, where all would participate for this market segment only.
The synergies that would be achieved by joining all of them in relation to online gaming would multiply gaming income and provide the regulator with greater abilities to inspect this new segment. The Macau government itself could be a shareholder through one of its own companies and a large junket could be associated with the new online gaming platform.
All of this would guarantee credibility, suitability, easy control and the enormous strength of the project.
Of course, the huge investments made by the concessionaires to date would require rules to protect the current casino industry.
Online gambling should only be offshore, meaning that it is forbidden for any Macau resident or tourist who is in Macau to participate and, if China does not feel comfortable, that it is also forbidden to Chinese players on the continent.
Under these conditions, online gaming would not interfere with current gaming and would be a complement to the revenue of casinos and the Macau government.
Credibility, trustworthiness and control are needed in a world where concerns about money laundering and financing of terrorism are paramount.
Today, it is possible and prudent to develop this type of gaming by respecting these rules.
In the next concession, all the concessionaires must be forced to join together in exploring the same online gaming platform.
They will continue to compete with each other in the traditional market for live casinos. However, they will be a single voice, full of credibility, suitability and strength, in the online market.
The government must rethink its strategy.
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