The world-beating gambling hub of Macau was to get a taste of Hollywood glamor as its newest casino resort made its debut yesterday with a glitzy grand opening that masks turmoil behind the scenes.
Pop diva Mariah Carey, film stars Leonardo DiCaprio and Robert De Niro, and director Martin Scorsese were among celebrities enlisted to help launch Melco Crown Entertainment Ltd’s US$3.2 billion Studio City project.
The movie-themed resort features a Batman flight simulator ride, a figure-eight Ferris wheel and art deco architecture evoking Hollywood’s early days.
Photo: Bloomberg
It is part of a wave of big-budget projects to open over the next two years. They were conceived at a time when a seemingly endless wave of money from wealthy mainland Chinese gamblers was flooding into the region, turning it into the world’s biggest gambling market.
Now, Macau finds the odds have quickly turned against it.
Mainland Chinese high rollers rise are staying away amid a persistent economic slowdown and Chinese President Xi Jinping’s (習近平) continuing crackdown on corruption, both of which are crimping lavish spending. The downturn has cut into profits at US casino operators such as Las Vegas Sands Corp and Wynn Resorts Ltd, which have multibillion-dollar projects in the pipeline.
“With the anticorruption campaign and the political sentiment, a lot of wealthy people feel going to Macau is very risky. They don’t want to be seen on the radar screen,” said Tony Tong, founder of Pacific Financial Services, a consulting firm that advises Asian casinos and junket companies.
Macau, an hour by ferry from Hong Kong, is the only place in China where casinos are legal. It has about three dozen casinos that rake in about seven times more revenue than the Las Vegas Strip.
Tong said wealthy mainland Chinese high rollers feel they have been to Macau “too many times” and are now eyeing other emerging Asian gambling destinations such as Vietnam, Cambodia, the Philippines, South Korea and Vladivostok in Russia’s far east.
Junkets, the often shadowy middlemen who have helped fuel Macau’s spectacular casino growth by acting as an informal banking channel, are feeling the pain. The companies lend gamblers money in VIP rooms and collect debts when they return home, allowing high-rollers to get around restrictions on how much money can be taken outside mainland China.
However, the system is collapsing as Beijing tightens up on money laundering and capital flight.
One junket operator, Neptune Group Ltd, which reported an annual loss of more than US$100 million, said it was thinking of closing more VIP rooms and moving into money lending or other businesses because of the prospect of increased scrutiny.
China’s economy “will no longer be the same dominant force to keep high-roller clients in abundant supply” for Macau’s casinos, the company said in its annual report.
Adding to the industry’s troubles, another junket company, Dore Entertainment, reported to police last month that an employee allegedly defrauded at least US$12.9 million from investors, who have held daily protests.
Casino floors have been noticeably quieter this year in Macau, where gambling revenues have fallen for an unprecedented 16 months straight.
Both Sands and Wynn said their most recent quarterly profit dropped sharply, burdened by their Macau businesses.
Wynn said VIP players were wagering half the amount they did a year earlier.
Wynn Resorts CEO Steve Wynn also lashed out at the Macau Government’s policy of reining in rampant casino growth by capping the annual increase in gambling table numbers by 3 percent.
Wynn’s exasperation was on behalf of Melco, which said earlier this year it was hoping for at least 400 tables to avoid defaulting on its US$1.4 billion loan.
After it was granted only 250 last week, the Hong Kong-Australian joint venture said it would be forced to renegotiate the loan terms.
Macau’s upcoming resorts will emphasize entertainment and shopping over gambling as casino operators bow to authorities’ desire to shed the city’s image as a sleazy, vice-ridden gambling haven to become a family-friendly global tourist destination.
However, Wynn said that transition is threatened if casinos cannot accommodate enough gamblers to fund it.
“The table cap is the single most counterintuitive and irrational decision that was ever made,” Wynn told analysts on a conference call. “The reason that these extraordinary non-gaming attractions exist is because the damn casino is the cash register.”
OpenAI has warned US lawmakers that its Chinese rival DeepSeek (深度求索) is using unfair and increasingly sophisticated methods to extract results from leading US artificial intelligence (AI) models to train the next generation of its breakthrough R1 chatbot, a memo reviewed by Bloomberg News showed. In the memo, sent on Thursday to the US House of Representatives Select Committee on China, OpenAI said that DeepSeek had used so-called distillation techniques as part of “ongoing efforts to free-ride on the capabilities developed by OpenAI and other US frontier labs.” The company said it had detected “new, obfuscated methods” designed to evade OpenAI’s defenses
NEW IMPORTS: Car dealer PG Union Corp said it would consider introducing US-made models such as the Jeep Grand Cherokee and Stellantis’ RAM 1500 to Taiwan Tesla Taiwan yesterday said that it does not plan to cut its car prices in the wake of Washington and Taipei signing the Agreement on Reciprocal Trade on Thursday to eliminate tariffs on US-made cars. On the other hand, Mercedes-Benz Taiwan said it is planning to lower the price of its five models imported from the US after the zero tariff comes into effect. Tesla in a statement said it has no plan to adjust the prices of the US-made Model 3, Model S and Model X as tariffs are not the only factor the automaker uses to determine pricing policies. Tesla said
China’s top chipmaker has warned that breakaway spending on artificial intelligence (AI) chips is bringing forward years of future demand, raising the risk that some data centers could sit idle. “Companies would love to build 10 years’ worth of data center capacity within one or two years,” Semiconductor Manufacturing International Corp (SMIC, 中芯) cochief executive officer Zhao Haijun (趙海軍) said yesterday on a call with analysts. “As for what exactly these data centers will do, that hasn’t been fully thought through.” Moody’s Ratings projects that AI-related infrastructure investment would exceed US$3 trillion over the next five years, as developers pour eye-watering sums
Australian singer Kylie Minogue says “nothing compares” to performing live, but becoming an international wine magnate in under six years has been quite a thrill for the Spinning Around star. Minogue launched her first own-label wine in 2020 in partnership with celebrity drinks expert Paul Schaafsma, starting with a basic rose but quickly expanding to include sparkling, no-alcohol and premium rose offerings. The actress and singer has since wracked up sales of around 25 million bottles, with her carefully branded products pitched at low-to mid-range prices in dozens of countries. Britain, Australia and the United States are the biggest markets. “Nothing compares to performing
RSS