Inside Asian Gaming

March 2012 | INSIDE ASIAN GAMING 17 W hen a senior Macau official went on a recent visit to Beijing, he made an unusual request to China’s political leadership, according to some sources. The Macau official suggested that Beijing rather than Macau should draw up a strategic plan for Macau’s development. If true, this tells investors almost everything they need to know about the way the territory is governed and what impact that is likely to have on the casino industry. In effect, the local official was sending several political messages. One was that Macau accepts its political subservience to Beijing, beyond even the junior partner relationship implied under Macau’s mini- constitution,TheBasic Law.WhileHongKong has constitutionally-speaking broadly the same subsidiary relationship to the People’s Republic of China as Macau does, it would be politically impossible in terms of Hong Kong public opinion for that city’s leaders to importune the national government for guidance quite so openly. Another message apparently being sent by Macau in its request for a‘grand plan’from head office is some degree of exasperation at having constantly to look over its shoulder and second guess what Beijing wants. Macau’s political leadership and civil service is less experienced at developing policy and its economy less diversified than that of its neighbour Hong Kong. Arguably, therefore, Macau might benefit from more guidance from the central government, or from having its development plan coordinated more closely with that of neighbouring Guangdong province—the source of around half of Macau’s annual visitors. That’s an important consideration because the casino industry and gambling in general are intensely political topics for China. Avoiding consumer excess in this area is closely tied to the wellbeing of the masses and the much-mentioned ‘social harmony’ and, thus, indirectly to the political survival of the Communist Party of China (CPC) itself. This raises a third issue. What the central government ‘wants’ in China generally and Macau in particular is not always clear, and is likely to remain somewhat hazy for the coming months and possibly years. That’s because China is entering a period of transition in national leadership. President Hu Jintao and Premier Wen Jiabao will soon retire after a decade at the helm. The fact that both of them are regarded as reform- minded on economic policy and that their tenure coincided with the ‘big bang’ of Macau gaming market liberalisation is Muddy Waters China’s national leadership transition could make things more complex when it comes to Cotai casino project permissions