Pansy Ho framed her keynote address at last week’s G2E Asia around a call for Macau’s casinos to continue to invest in making the city a more diversified and all-around resort destination.
“There’s no alternative sector to replace the success of the casinos in Macau,” said the billionaire Hong Kong businesswoman, a daughter of legendary Macau casino tycoon Stanley Ho and co-chair of MGM China Holdings. “We should invest also in MICE, entertainment, retail, clubs and art to diversify our offer.”
Noting that gaming accounts for 25 percent of the labor force and 80 percent of government revenues, Ho warned that Macau’s economy is vulnerable if it continues to depend on a single industry.
“The casino success was not in vain, of course, but we need to diversify and address our economic and social issues,” she said.
Her sentiments were echoed by American Gaming Association President and CEO Geoff Freeman, who spoke at a media briefing session on the first day of the show, saying that based on the Las Vegas experience the factor that leads to success in diversifying the local economy is the development of the meeting, incentives, conference and exhibition industry.
“As you bring in the meetings and the customers, their interests vary,” he said. “Some are interested in gaming; some are interested in using the spa services; someone will play golf; some are in the restaurants. So I think that the MICE market and all aspects of it are critical to driving a successful non-gaming business.”
The AGA is co-sponsor with Reed Exhibitions of G2E Asia, the largest gaming industry trade show and conference in the region. The event covered 9,000 square meters this year at its annual home at The Venetian Macao Convention and Exhibition Center and featured 160 exhibitors. Reed had forecast the 2014 version, expanded for the first time to three days, would attract more than 6,500 visitors and attendees.
Freeman said the local officials he met are confident about the continued success of Macau, which has been rocked in recent weeks by reports of crackdowns on illicit cash flows into the territory and visa permit abuses and by ongoing investigations into money laundering that have cast a harsh light on the junkets that control the market’s massive high-roller trade.
“It seems that everyone’s always looking for reasons to prove that Macau is not the success it is,” MGM China CEO Grant Bowie said at the show’s opening session. Investors “need to understand Macau,” he said, and that’s “impossible” to do from New York or London.
“We should focus on Macau’s success story; these are minor events that will not affect the long term,” added Wynn Macau President Gamal Aziz. “Macau is a unique success in the industry.”
While VIP has entered a period of “consolidation,” Aziz said, he reiterated the widespread belief that the city’s future lies with the high-margin mass market, which does not depend on junkets and is growing at triple-digit rates, accounting now for 70 percent of the casinos’ profits.
“Any destination in the world would like to have what Macau has in terms of access to so many billions of people,” said Freeman. “That’s where this opportunity is so extraordinary.”
For G2E Asia, it was the most successful show ever, with more than 6,500 attendees (unofficially, audited attendance data will be released soon). The show floor grew by over 20 percent from last year, and a robust conference program wrapped up on Thursday with an iGaming Summit focused on the Asian market.
This year, more than other previous shows, exhibitors demonstrated that their focus at G2E Asia was squarely on the Asian customers. Slot manufacturers displayed a wide range of Asian-themed games. Electronic table games were front-and-center with a selection of “stadium” style games that appeal to jurisdictions like Macau where either the number of tables is capped or lower limits allow for wider appeal. Productivity solutions were apparent across the floor, as were service companies that did everything from slot testing to consulting.
At the end of the week, it was clear, that while Las Vegas will always represent the American ideal of gaming, Macau is becoming more and more like the shining city on the hill for global gaming.