Inside Asian Gaming

INSIDE ASIAN GAMING | Oct 2007 40 Politics party and state enterprise officials who ap- ply to make ‘business trips’ to Macau. Suspected smokescreen A double permit policy similar to the one just proposed had previously been in exis- tence but was dropped after concerns that people—particularly mainland officials— were using the Hong Kong part of the joint permit as a kind of smokescreen to legitimise their real aim: gambling sprees in Macau. One of the aims of Macau’s Chief Execu- tive Edmund Ho and his team while attend- ing the National Congress will have been to reassure the leadership that a resumption of a joint permit will bring solid economic benefits rather than social ills.Mr Ho also has to manage concerns within Hong Kong that Macau is somehow ‘robbing’ its neighbour- ing Special Administrative Region (SAR) of tourism revenue because of the surge of visi- tors drawn by the excitement of new casinos, though that idea has been formally denied by Frederick Ma, Hong Kong’s Secretary for Commerce and Economic Development. Of the 13.02 million visitors to Hong Kong in the first half of 2007, more than half—7.09 million—were from the Chinese mainland, an increase of 5.9% on the num- ber of mainland visitors compared to the equivalent period in 2006. Official figures suggest though that last year one in five of all visitors to Hong Kong also made a trip to Macau (two million out of 10 million arrivals), but only 3% of direct visi- tors to Macau made the reverse trip to Hong Kong (300,000 out of more than 10 million visitors to Macau). This suggests shoppers like to gamble, but that gamblers aren’t par- ticularly motivated to shop—for the time being anyway. Improving synergies Part of the latest joint permit plan is to improve the ‘synergies’ between the two tourism destinations by engaging in cross promotion, says James Tien, chairman of the Hong Kong Tourism Board. May’s permit clampdown on Guang- dong residents travelling to Macau followed violent May Day demonstrations for the second year running by the territory’s long- term unemployed who fear illegal mainland workers and foreign staff are robbing them of their already slim chances of finding a job. During this year’s disturbances, a policeman fired his gun in the air,sparking a Macau gov- ernment investigation that exonerated his actions but was regarded in some sections of the local media as a whitewash. Whatever the rights and wrongs of the individual incident, it’s clear Beijing will not want a repeat performance next spring. The 1st of May is internationally recognized as a day for honouring workers around the world, and is therefore a particularly important and sensitive date in the Chinese government’s calendar. A reshuffle of the Central Government Liaison Office—the mainland officials who oversee China’s relations with its SARs— which took place at the time of the Party Con- gress,will have been seen as a good opportu- nity to make a fresh start regarding Beijing’s long-term attitude toward its citizens’ visits to the former Portuguese territory. In the re- shuffle, Peng Qinghua, the current deputy of the Liaison Office,was appointed to the CPC’s Central Committee—the most senior policy- making body in the People’s Republic. Experi- enced China watchers will tell you this means Mr Peng is now, politically speaking, senior to his nominal boss Gao Siren, and therefore the man with whom to do business. Achieving social harmony The development then of a new visa policy for mainland residents involves the reconciliation of all the interests of the three jurisdictions in order to achieve ‘social harmony’—a popular theme in Confucian philosophy and among the current political leadership. This is tricky because at the moment mainland residents mainly come to Macau to gamble, and gambling is regarded offi- cially by Beijing as socially undesirable. Since August the party has decreed its 72.4 million members must watch an educational video called The Evils of Gambling, produced by the CPC’s Central Commission for Discipline Inspection. The video pointedly reminds view- ers what happens to people who take the Party’s pragmatic toleration of gambling in Macau as a cue to pillage public funds. Among its Hall of Shame are featured Lin Longfei, the party secretary of a Fujian province county, a corrupt and unrestrained gambler who kept 22 mistresses before be- ing caught and executed. Other notables areWu Huali, police chief in the Guangdong city of Huizhou, who was sentenced to 12 years in jail after losing 10 million yuan (US$1.5 million) in public funds on 68 trips to Macau. Li Shubiao, a housing official in Henan province, laundered 120 million yuan through underground banks and lost 80 million yuan of it in Macau’s ca- sinos. His fate is not mentioned. Recent reports in the Chinese-language media in Macau say undercover police have been sent from the mainland to keep checks on who is at the gaming tables and how much they are wagering. Despite these central government con- cerns, the trend in China is for increasingly free movement of goods and people. The Individual Visit Scheme for PRC residents wishing to travel to the two SARs—institut- ed in 2003—is being extended on a rolling basis every year to provinces and cities well beyond Guangdong. Given that the process of economic and social reform in China began less than 30 years ago under Deng Xiaoping after China’s centuries of self-im- posed cultural and political isolation, the changes are remarkable. Investors in Macau need to remember though that China’s path is likely to take occasional steps back in order to move forward. Even the bright lights of Hong Kong are unable to draw gambling-focused Chinese visitors from Macau