China Underground > Essential guide to China > The History of Macao

The History of Macao

2021 is shaping up to be a year of recovery from the global pandemic that still holds many countries in lockdown. Scientists predict the vaccination efforts underway all over the world will allow many places to reopen their borders – and thus their economy – to visitors.

Macao is one of the countries that adopted a combative approach to COVID-19 early on. Thanks to a strict government program, the total number of COVID-19 cases in Macao is below 50, with no reported deaths.

Now that restrictions for visitors from mainland China have been lifted, it’s a great time to think about going to this country on your next vacation. Macao is a country with a rich history and a haven for extravagant casinos.

Two Major Players Vying for Paradise

Macao’s history is long and turbulent, particularly in the last thousand years. Though it was caught in a struggle for control between China and Portugal for multiple centuries, even getting Japan’s attention at one point, Macao remained an oasis of peace and prosperity.

In 1277, the Mongol conquest of China brought around 50,000 Chinese refugees to Macao, where they built settlements. Things got complicated when, in 1513, Jorge Alvares landed on Macao’s shores in the name of the expanding Portuguese Empire. Neither Portugal nor China would surrender control of the peninsula, resulting in a strenuous joint rule.

The dubious alliance held until 1999, with the balance of power constantly shifting from one nation’s hands to the other. Finally, Macao became a Special Administrative Region of the People’s Republic of China, but it retains a high level of autonomy. Under its local government, it has become a leader in the global gambling industry.

The Casino Giant Has Awakened

The history of gambling in Macao is similarly fascinating, particularly because it’s the biggest source of profit for the entire region. The gambling market accounts for over 40% of Macao’s GDP and around two-thirds of the government’s tax revenue.

Macao’s official gambling roots were established in 1847 by the Portuguese government with a licensing system for the popular fan-tan gambling stalls. Since then, the near-constant monopoly on gambling transferred from the hands of one triad “company” to another. The first “King of Gambling” was Lou Kao, whose Hong Feng Company operated in the late nineteenth century, only to be succeeded and surpassed by his son. 

The first official monopoly concession on Macao gambling was given to the Hou Heng Company in 1930. Its owner worked to diversify Macao’s gambling offer, including new games and Western-style flashy casinos. Hou Heng’s dominance only lasted for seven years, however, until its owner’s death. After that, this casino monopoly was transferred to Tai Heng Company in 1937, which furthered the Westernization trend. As both company owners died before they could renew their concession in 1961, the STDM Company, co-owned by the Hong-Kong billionaire Dr Stanley Ho took over in 1962. STDM kept its monopoly for 40 years, until 2002. After that, the Macao government expanded the number of concessions from one to three, and then further. 

In the 21st century, Macao’s Gaming Inspection and Coordination Bureau (DICJ) extended those three operating permits to three companies: SJM Holdings (also owned by Stanley Ho), Wynn Resorts, and Galaxy Entertainment Group. The number of casinos with operating concessions increased to six by 2004, as all three corporations signed contracts with other corporations to bring them on. As of 2019, the monopoly-holders operate 41 casinos in Macao.

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The creation of the Cotai Strip was the biggest step the Macao government took in developing the gambling market. The idea was to build a casino-only territory that would mimic the Las Vegas Strip, but on a smaller scale. The Cotai Strip surpassed all expectations, contributing a total of $63.22 billion to the GDP, compared to Las Vegas’ GDP of $103.34 million. In practice, that means the per-capita GDP in Macao was twice what it is in Las Vegas. This is just one point of comparison between the two biggest gambling destinations in the world. Of course, the ever-expanding collection of Cotai 24-hour casinos has become one of Macao’s biggest tourist attractions.

Some of the most popular games available are fan-tan, sic bo, roulette, blackjack, baccarat, slot machines, and the newly added Texas Hold ’em poker.

Thanks to gambling, the unemployment rate in 2019 was 1,7% – an all-time low. Not everything is rosy, though. The gap between the rich and the poor is wider than ever in Macao society. And be careful of the “Bate-Ficha” triad businesses dealing dead chips. You cannot trade these chips for money with anyone but the Bate-Ficha promoters and mediators. Even though Macao reduced the level of organized crime as of late, it’s still prevalent enough to result in violent quarrels between gangsters relatively often.

Unfortunately, Macao’s casinos fell upon hard times with the onset of the pandemic. At the end of 2020, the number of tourists from China was down by 77% compared to December 2019. In January 2021, there were 89% fewer tourists from Hong Kong than there were a year before. International tourism is down 100%, as foreign tourists are not yet permitted to visit Macao.

However, quarantine for people from mainland China is no longer mandatory, so the future doesn’t look as bleak. What’s more, Macao’s gambling market is currently experiencing stable growth: The first week of March 2021 has brought 19% more earnings than the last week of February. Add to that the technological investments Macao shifted towards recently, and you can see why the peninsula expects an upward profit trend in 2021.

The Eye of the Casino Tiger

So, you’re going to Macao: With over 40 casinos available, where should you start your traveling festivities? Here are a couple of recommendations on where to start with the magical voyage.

  • Wynn Palace – a luxurious resort casino with over 1,700 lavish rooms, Wynn Palace, leaves all visitors with lasting and wonderful memories. It also houses the most exclusive spa, beauty salon, and pool in Macao. For unforgettable evenings of entertainment, you have breathtaking choreographed ballets by the Performance Lake and an extensive art collection by the worlds’ most famous artists.
  • The Londoner Macao – the latest casino addition and the home of the worlds’ largest Holiday Inn, has over 1,200 rooms in a distinctly British style. And the newly opened Crystal Palace atrium will leave everyone speechless with restaurants and attractions modeled to mimic the unique London experience.
  • Studio City – a towering architectural jewel represents the fusion of film production, casino, and a hotel experience to its visitors. There are 1,600 rooms and 400 gambling tables situated in two hotel towers connected with an 8-shaped Ferris wheel that is out of this world.

No Place Like Macao

Entering the Cotai strip in Macao is like entering another world. If you are looking for life-long memories of travel and fun, the Macao Peninsula will give them to you in spades. You can also visit their 130-year-old Taoist Na Tcha Temple, the Portuguese-inspired Senado Square, and try their delicacies. Whatever your preference, Macao will deliver an everlasting experience.

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