Expansion Stops At Macau

04.22.2008 | 1:25 pm | News, casinos

While the tiny enclave of Macau has not been out of the news for the last few years, it seems that the mass of new casino ventures in the area have now come to a stop. Macau Chief Executive Edmund Ho took the markets by surprise with his announcement that the authorities were calling a halt to the issue of new casino licences for the time being. So what has happened?

The news has prompted a mixed reaction from those in the industry, with those already in position set to see the value of their ventures rise in value, and those yet to gain a licence forced to wait for what could be some time. However, how refreshing is it to see authorities who know when it is time to call a halt to expansion plans rather than push the enclave to the limits and flood the market.

If the rumours are correct it seems as though the Chinese authorities have had a direct hand in the freezing of licences, “advising” the Macau leaders that enough was enough and it was time to take stock. While the enclave has a certain degree of self control there is still a direct link to the main Chinese government which is there to advise and assist when required.

Macau has issued three casino licences and three casino sub-licences in total which allow six companies to run 29 casinos. When you consider that the area has gone from zero to the top casino resort in the world in less than a decade, putting the likes of Las Vegas in the shade, it really is a breath taking story. As we touched on above, it is also refreshing to see authorities who know when they are about to “over crowd the market”, especially when you consider the current outlook for the worldwide economy.