1
Dependent Development?
Macau’s Gaming Industry: Its Problems and Prospects
Zhidong Hao
University of Macau
ABSTRACT
Six years has passed since the liberalization of Macau’s gaming industry in 2002, and people
have begun to talk about “re-colonization” or “the new Opium War.” Given the weight of
such matters, it is important that we understand the development of Macau’s economy,
especially the gaming industry, where we have witnessed heavy foreign investments in the
last few years. This paper will first explain dependency theories, especially dependent
development and the developmental state. Second, we will see what the problems are in
Macau’s economy. Third, we will discuss how the problems might be resolved following the
route of dependent development. Fourth, we will emphasize the important role of the
developmental state and community organizations. The major argument of the paper is that
while it is generally a good idea to introduce foreign capital to Macau’s gaming industry, the
state needs to balance the interests of the local capital, foreign capital, and the local
community. Only when their interests are balanced can there be development. This is
especially important since more countries and districts in the region like Japan, Singapore,
and Taiwan have either been building casinos or thinking about it. There has been constant
talk in Hong Kong, too, about establishing casino style gambling. Our study thus also both
helps understand such issues in other areas and calls for further comparative research on the
same topic. The method I use is mainly historical-comparative, but relevant statistical data
will also be presented to illustrate the issues discussed.
Keywords: dependent development, gaming industry, local and foreign capital, the
developmental state, Macau
The gaming industry seems to be flourishing in many parts of the world. In Asia alone,
Macau has already become the world’s gambling mecca, surpassing the Las Vegas Strip in
revenue in 2006, and was positioned to surpass Clark County in 2007, with a gambling
income of 83 billion Macau patacas (MOP).1 Korea already has casino style gambling, and
Japan and Singapore are building casinos. Taiwan, and even Hong Kong, are thinking about
it. Mainland China does not have casino style gambling, but other kinds of illegal gambling
have also persisted, and state lotteries have long been introduced. The trend seems
unstoppable in whatever forms. It is understandable, for example, then that in the 1960s, the
British government was talking about discouraging and strictly controlling gambling, but in
the 2000s, it is talking only about keeping gambling crime-free, ensuring that it is conducted
fairly and openly, and protecting children and other vulnerable persons from being harmed or
exploited by gambling.2
1
Clark County includes not only the Las Vegas Strip, but also the Las Vegas Downtown, North Las Vegas,
Laughlin, Boulder Highway, and Mesquite. The gambling revenue for the county in 2006 was US$10.6 billion,
or Macau patacas (MOP)$84.8 billion. One USD equals about 8 patacas. See “Qunian Dushou Sheng Yue
Sicheng Da 830 Yi” (The income from gambling had a 40% increase and reached MOP$83 billion” in Macau
Daily, January 4, 2008, A10. See also Joao Francisco Pinto, “Macau bigger than Clark County by year’s end,”
p. 67, in Macau Business, December 2007.
2
See Annual Report of the Gaming Board for Great Britain 2004-05 at the British Gambling Commission’s
website http://www.gamblingcommission.gov.uk/Client/mediadetail.asp?mediaid=3, accessed on January 12,
2008.
2
In the globalization of gambling, Macau has made great strides since the liberalization of
gambling in 2002. In 2001 foreign direct investment was only MOP$1.3 billion, but in 2005
it was already MOP$10.6 billion, most of which was casino capital.3 The increased casino
revenue also means increased government tax dollars. The six concessionaires each has to
pay 35 percent taxes on their gross gaming revenues in addition to 1.6 percent of them to
Macau Foundation for social, economic, and cultural development, and 2.4 percent for urban
development and construction.4 This means that in 2007 alone, Macau government collected
MOP$32.4 billion in gambling taxes. And over 80% of the government revenue comes from
gambling. In 2006, Macau’s gross national product per capita was already MOP$227,508,
surpassing that of Hong Kong, and close to Japan.5
Should all these data mean that Macau’s economy is developing healthily? Not necessarily.
Problems abound. In fact, this paper attempts to understand the problems derived from the
gaming development and to explore ways to deal with them. In doing this, I find that the
theories of development, such as the world-systems, dependency, dependent development,
and the developmental state, are quite relevant and useful. So I will explain these theories
first before I move on to an explanation of the problems and their possible solutions by using
these theories. The method I use in this paper is mainly historical-comparative, but I will also
present statistical data to illustrate the points I am trying to make.
1. DEPENDENT DEVELOPMENT, THE DEVELOPMENTAL STATE,
AND MACAU’S GAMING INDUSTRY
Generally speaking, there are three branches of theory regarding development: modernization
theory, dependency theory, and the world-systems theory. Modernization theories view
development as from traditional to modern, stage by stage, politically, economically, and
socially. Classical dependency theories think that underdevelopment was caused by the
exploitation of the underdeveloped countries by the developed ones. So dependency is
necessarily bad. The new dependency theories, namely, dependent development theories,
however, think that the interests of the exploiter and the exploited can overlap. Development
is possible even when there is dependency.6
Closely related to the dependency theories is Wallerstein’s world-systems theory, which
believes that there is a capitalist world-system. Rich industrialized countries like the U.S.,
Japan, Britain, France, and Germany, are in the core. The underdeveloped countries are in the
periphery, while those that trade with both the core and the periphery, like Taiwan and Korea
See “Xiyin Waizi Yazhou Di San” (Number 3 in Asia in attracting foreign investments), Shang Xun (Business
intelligence), Issue 28, December 2007.
4
See So Hang Tai, “The Deficiency of Macau’s Over-reliance Economy on the Gaming Industry,” p. 75 in
Aomen Yanjiu (Journal of Macau Studies), Vol. 32, February 2006.
5
Lou Shenghua, “Liyi Fenhua, Jiegou Chongshu: Aomen Jinnian Shehui Jingji Wenhua zhi Ju Bian” (Divided
interest, reformed structures: the great changes in social, economic, and cultural aspects in Macau), Macao
Daily, November 21, 2007, F2.
6
For discussion of development theories in these pages, see Alvin Y. So, Social Change and Development:
Modernization, Dependency, and World-System Theories (Newbury Park, California, USA: Sage Publications,
1990). For more studies using development theories, see York W. Bradshaw, “Dependent Development in Black
Africa: A Cross-National Study,” in American Sociological Review, Vol. 50, No. 2. (Apr., 1985), pp. 195-207;
Masayo Goto, The pattern of development in East Asia and Japan's trade and investment in the region: The
cases of Malaysia and South Korea. Ph.D. dissertation, University of New South Wales (Australia, 2001),
Retrieved January 8, 2008, from ProQuest Digital Dissertations database. (Publication No. AAT 0804847).
3
3
in the 1970s and 1980s, are in the semi-periphery. The former Communist countries belonged
to a different system, but many of them are now being integrated into the capitalist worldsystem, like China. Dependency development, then, could mean a process by which
underdeveloped countries move from the periphery to the semi-periphery, and then from the
semi-periphery to the core.
Furthermore, as Gereffi and Evans point out, “The process of dependent development is the
result of the interaction of TNC [transnational corporations] strategies with the political and
economic strategies of local social classes and host country states.”7 This touches on Evans’
concept of triple alliance. In his 1979 analysis of the development in Brazil, Evans discusses
the interaction of the multinationals, the local capital and the state in deciding the direction of
the socioeconomic development of a country.8 To be more specific, it might be useful to
separate local capital from other classes. McDonough refers to other members or classes as a
fourth actor, either in alliance with the above mentioned three, or in conflict with them,
including, for example, the labor and/or other social organizations.9
Also related to the triple alliance is the concept of the developmental state. This concept
“focuses on the political will, the ideological coherence, the bureaucratic instruments, and the
repressive capacity needed to formulate and implement effective economic policies to
promote high-speed capitalist growth.”10 The kind of state in developing countries includes
the bureaucratic-authoritarian state like that in Latin America in the 1960s and 1970s or that
in Taiwan and Korea in the 1970s and 1980s. One might even argue that it is the kind of state
in mainland China now. In all of these cases, the state was able to institute rules and
regulations that encourage foreign investment in their home countries and to repress labor
movements to create the welcoming environment for foreign capital. Many of these regimes
have later on developed into democracies as they enter the semi-periphery and even the core,
like Taiwan and Korea. The mainland Chinese state seems to be developing in the same
direction, following what is often called the East Asian Model (of dependent development).
Are these theories applicable to the analysis of Macau’s economy? There are several
difficulties. First, dependent development theories as we explained above are mainly applied
to countries where manufacturing is the chief money-making industry, as in mainland China
now.11 The nature of the transnational corporations (TNCs) is thus very different: in Macau it
is the service industry, especially the part that is related to gaming, the money-maker of the
economy. As Gereffi and Evans point out when comparing Brazil and Mexico, “students of
dependent development will be faced with a new series of intellectual challenges” when
applying the theory of the development of the manufacturing industry to the development of
Gary Gereffi and Peter Evans, “Transnational Corporations, Dependent Development, and State Policy in the
Semi-periphery: A Comparison of Brazil and Mexico” in Latin American Research Review, Vol. 16, No. 3.
(1981), p. 33.
8
Here I am referring to Peter Evans’ book Dependent Development: The Alliance of Multinational, Stat, and
Local Capital in Brazil (Princeton, NJ: Princeton University Press, 1979).
9
In a review of Evans’ 1979 book, Peter McDonough refers to the fourth actor as the church, politicians, and the
labor leadership in Brazil. See his book review in The American Political Science Review, Vol. 74, No. 1.
(March, 1980), pp. 234-235. In Macau, the role of the church is very limited. Politicians seem to be part of the
state, even though they may have different views regarding development. But labor is indeed a force, albeit not a
very forceful one. We will discuss these actors later in the paper.
10
Gary Gereffi and Stephanie Fonda, “Regional Paths of Development,” Annual Review of Sociology, Vol. 18.
(1992), pp. 424-5.
11
See Gerefi and Evans, “Transnational Corporations, Dependent Development, and State Policy in the Semiperiphery,” pp. 31-64.
7
4
the service industry. 12 Macau’s is not only a service industry, but also a special kind of
service industry.
Second, although the four actors also exist in Macau, they are of a very different nature than
the ones analyzed in the literature. The multinational corporations are all of one kind: they are
gambling businesses, providing a special kind of service. And even the local capital defies
defining. In 2001, after Macau was returned to China, the Macau SAR (special administration
region) government decided to end the monopoly by STDM (Sociedade de Turismo e
Diversões de Macau, or Macau tourism and recreation company), headed by Stanley Ho, and
to open the industry to foreign competition. In 2002 it granted three concessions: Wynn
Resorts from the U.S., the Galaxy Group of Hong Kong, and STDM (now called SJM,
Sociedade de Jogos de Macau, or Macau gaming company). Wynn Resorts then offered a
sub-concession to Melco PBL, which opened The Crown Casino in Macau in 2007. Melco is
the Melco International Development Limited (新濠國際發展有限公司), a conglomerate in
leisure, gaming, and entertainment, located in Hong Kong and with Yau Lung Ho, a son of
Stanley Ho’s, as the chairman of the board and chief executive officer. PBL is a broadcasting
and entertainment industry based in Australia. So Melco PBL is a joint venture of the two
companies. It is hard to say whether Melco PBL is a local or foreign capital. The most we can
say that it is both, if we consider Hong Kong as local, or at least as Chinese vs. foreign.
The Galaxy Group offered a sub-concession to Las Vegas Sands, which opened The Sands in
2004, and then The Venetian Macao in 2007. The entire 120 acre “Cotai Strip” featuring a
number of casino hotels is expected to open in 2009.13 SJM offered a concession to MGM
Grand Macao, which was open in late 2007. MGM Grand Macao is a partnership between
MGM Mirage of Las Vegas and Pansy Ho Chiu-king, one of Stanley Ho’s daughters, the
Chairwoman of Macau Tower Convention & Entertainment Center, and Executive Director
of Air Macau Company Limited.14
So out of the six major players, the Sands and the Wynn can be viewed as foreign capital,
while SJM is entirely Chinese (local) capital. Galaxy Group is not entirely Chinese, since in
October 2007, Permira Funds, a British company, bought 20% of the shares of the Galaxy
Holdings, which means that they will be a gambling business partner as well. Melco PBL and
MGM Grand Macao are both joint ventures about 50% Chinese and 50% foreign. To use the
words of Tan Bo-yuan, the secretary of finance of the Macau government, half of the capital
is local (meaning Macau and Hong Kong), while the other half is foreign.15 One can argue,
however, that none of them is really local, since they are either from Hong Kong, the U.S.,
England, or Australia. And they are all TNCs. But because the CEOs of both Melco PBL and
MGM Grand Macao are Chinese and they own a bit over half of the stocks of these
Gereffi and Evans, “Transnational Corporations, Dependent Development, and State Policy in the
Semiperiphery,” p. 57.
13
According to Sands Macao’s news release on August 28, 2006: “The Venetian Macao will also serve as the
anchor of the Cotai Strip(TM), a master planned development of resort and casino properties. The Cotai Strip
will feature hotels operated by some of the most prestigious names in the hotel industry, including, Four Seasons,
Sheraton, St. Regis, Shangri-La, Traders, Hilton, Conrad, Fairmont, and Raffles. Las Vegas Sands Corp. will
own and construct each of the hotels as well as operate the casinos and entertainment venues in each hotel.” See
http://phx.corporate-ir.net/phoenix.zhtml?c=185629&p=irol-newsArticle&ID=899653&highlight= [09/03/2006].
14
The Harrah’s has just bought a large stretch of golf-course on the Cotai Strip, and is likely to use it for a
casino in the future if the government agrees. But for now we will not yet consider Harrah’s as one of foreign
capital in the gaming industry.
15
Words quoted by Xie Side, “Bocai Ye Chenghong You Shichang Jueding?” (Is success of the gaming
industry determined by the market alone?” Macau Daily, December 9, 2007, p. A11.
12
5
companies, they take on an air of local capital, and interact with the American companies as
if they are different.
So third, what is the interaction like between the foreign and local capital, if we can separate
the two, then? As Gereffi and Evans ask, “To what extent has the level of external control
over the local economy been exacerbated by displacement of the national bourgeoisie? To
what extent have these effects been counterbalanced by joint national-foreign ownership of
TNC subsidiaries and effective state regulation of their behavior?”16 That we need to find out.
Fourth, the developmental state is also different from those in the literature. Like Hong Kong,
under the “one country, two systems” formula, Macau enjoys high autonomy in the People’s
Republic of China (PRC). It has more democratic elements in its political system. For
example, the Chief Executive is elected by a committee of 300 representatives from various
social organizations, and 12 of the 29 legislators are elected by the populace, 10 are elected
by social organizations, and only 7 are appointed by the Chief Executive. This in general is
more democratic than the mainland system. How effective is the state in its interaction with
the other three actors: local capital, foreign capital, and the larger community, then? This is
what we need to analyze as well.
As we can see, although the above mentioned development theories seem applicable in the
analysis of Macau’s economic development, the situation in Macau poses more challenges.
Nonetheless, they do help us explain the development in Macau to a great extent. When
discussing the development of Brazil in the 1970s, Fernando H. Cardoso points out that
dependent development is not without cost, including “a regressive profile of income
distribution, emphasizing luxurious consumer durables as opposed to basic necessities,
generating increasing foreign indebtedness, contributing to social marginality and the
underutilization and exploitation of manpower resources, and thereby leading to an increase
in relative misery.” 17 Macau’s situation is different, but we want to see how different or
similar it is. We will now examine the problems in Macau’s gaming industry in light of the
dependent theories we outlined above.
2. PROBLEMS IN MACAU’S GAMING INDUSTRY
In the following pages, we will discuss some serious problems in Macau’s economy,
including the difficulties facing other parts of the service economy, the political challenge
derived from the competition between foreign and local Chinese companies, and the casino
operators’ responsible gaming practices in relation to their corporate social responsibility. We
will also discuss the role of the state in solving these problems.
First of all, the expansion of the gaming industry has greatly strained other enterprises’
human resources, and the latter also find that they are losing business to casinos, at least they
think they do. And they have to find ways to survive in the market. This is a different kind of
“displacement of national bourgeoisie,” as explicated in the dependent development theory
we mentioned above.
With the industry hiring more people, other enterprises find that their employees leave them
for casino jobs. By the end of 2005, the gaming industry employed 26,000 workers, an
Gereffi and Evans, “Transnational Corporations, Dependent Development, and State Policy in the Semiperiphery,” p. 32.
17
Paraphrased by Alvin Y. So, Social Change and Development, p. 141.
16
6
increase of 22.8% compared with 2004.18 With the new casinos opening, the industry was
already hiring more than 45,000 workers in 2007. (The population in Macau is 525,000.)
There were 28 casinos by the end of 2007 and it is estimated that there will be altogether 30
casinos by 2009.19 According to government statistics, there are 26,000 enterprises in Macau,
and 99% of them hire fewer than 100 people. In fact, 91.5% of the enterprises hire fewer than
10 people.20 It is these enterprises that feel the strain in human resources. Casinos tend to pay
more money than these small companies can, and they provide better working conditions,
including normal weekend and public holiday breaks, so such employers are witnessing large
numbers of their workers quit their jobs to join the casinos. The tourist industry, for example,
has lost 40% of their employees to casinos, including their drivers and secretaries. There are
over 100 travel agencies hiring 3,000 workers, but they find they need to apply for nonMacau resident, i.e., foreign labor, or the so-called wailao workers.21
What can the state do, then? One of the most acute social problems in Macau now is the socalled hei gong, or illegal workers. There have increasingly been more demonstrations in
Macau, for example on May 1 (Labor Day), October 1 (National Day), and December 20 (the
day of Macau’s return to China). One of their complaints is that companies prefer to hire
foreign to local workers. So the government is very careful in allowing only a limited number
of non-Macau workers so as not to antagonize the locals. But this further exacerbates the
labor shortage problem. Many have called for relaxation of the rules for hiring foreign
workers, such as allowing foreign, but mostly mainland, college students graduated from
Macau to join the labor market, even for a year or two, in Macau, but the developmental state
is too cautious to act on such suggestions. Because of the executive-led structure of the
government, the legislature does not seem to be doing much in this regard, either. So the
developmental state is a rather week one, as we can see in its ways of dealing with this and
other problems. After the Ou Man Long corruption case, the government seems even weaker,
not taking as much responsibility as it should for fear of making more mistakes.22
Second, the competition between Stanley Ho’s SJM, the local Chinese gambling company,
and the American-owned casinos has become intense. And it arouses nationalist feelings.
This may be the major “displacement of national bourgeoisie,” if we view SJM as local and
national, although SJM, and even Melco PBL and MGM Grand, do like to view themselves
as local.
As we mentioned earlier, Stanley Ho’s businesses are local in the sense of Hong Kong and
Macau, which are both Chinese territories. His businesses are mostly in these locations. And
he is a member of the Standing Committee of the Chinese People’s Political Consultative
Conference, an organization composed mostly of various small political parties and groups,
whose importance is close to the Chinese National People’s Congress. On the other hand, he
used to own nine casinos in the Philippines, and he now owns the majority share of a casino
in Lisbon, Portugal. Overall, he has business interests in mainland China, Portugal, North
Korea, Vietnam, and the Philippines. The company has in the past decade or so tried to gain
See an article on the increase 22.8% in the number of workers in the gaming industry, “Bocai Congyeyuan 2.6
Wan Da Zeng 22.8% , Macao Daily, March 31, 2006, A10.
19
See an article on the number of casinos in 2009, “Zhi 09 Nian Ao Zhishao Haiyou 30 Ge Jinsha”, Macao
Daily, April 15, 2006, A7. It should be 30 altogether rather than 30 more.
20
See an article on the government policies needing to tilt toward medium and small enterprises, “Zhengce Bi
Xiang Zhong Xiao Qi Qingxie,” Macao Daily, Nov. 26, 2006, B1.
21
See an article on the tourist industry losing 40% of its employees, “Luyou Ye Renyuan Lishi Si Cheng”,
Macao Daily, Aug. 27, 2006, A1.
22
See Joyce Pina, “Transparency Takes Time,” in Macau Business, March 2008.
18
7
gambling licenses in Australia, Canada, and the Philippines, although unsuccessfully because
these countries questioned, but never confirmed, his ties with organized crime. In the
Australian case, one of Stanley Ho’s executives attributed the failure to obtain a gambling
license to Australian “racist policies.” 23 Apparently, Stanley Ho is not happy with his
frustrations in these failed efforts that may have to do with racial and ethnic reasons. So in a
word, his company does have some characteristics of transnational corporations, although it
can be treated mostly as a local Chinese company.
In 2005 SJM had a gross income of MOP$34.4 billion, 75.5% of the share of the market,
Sands Macao made MOP$7.7 billion, 17%, and Galaxy made close to MOP$4 billion, or 9%
of the share. Although SJM still had the largest share, its share decreased by MOP$800
million, or 2.3%, while Sands Macao increased its share by 147.7%, and Galaxy by 29.3%.24
By November 2007, the market shares of these companies are: SJM, 37%; Las Vegas Sands
(LVS), 28%; Galaxy, 15%; Wynn, 15%, and Melco PBL, 5%.25 In January 2008, the market
shares of each operator were changed as follows: SJM, 30%; LVS, 21%; Galaxy, 10%; Wynn,
17%; Melco PBL, 16%; MGM (opened in December 2007), 7%. We can already see a
decreased share of the market on the part of SJM, although it might have picked more in
February 2008 since it opened another casino then. Melco PBL and MGM Grand might take
more of the market share in the future. By 2009, however, LVS plans to take 60% of the
market share, 26 which would leave SJM with an even smaller market share. It does not,
however, necessarily mean that this will happen, or SJM will make less money. In September
2007, for example, SJM saw an increase of revenue by 10% compared with the same period
last year.27 But the competition brings other problems. The loss of market share makes an
effect mainly on the psychology rather than on economics of the local capital.
Stanley Ho has already complained that the American companies were practicing unfair
competition by enticing his employees and not fulfilling their promises for investing in
schools and gardens. Most recently he has accused American companies for taking the money
they make back to the United States. He even blamed them for students’ dropping school to
work in casinos. But Sheldon G. Adelson, chairman and chief executive officer of Las Vegas
Sands Corp, and William Weidner, president and chief operating officer of Las Vegas Sands
Corp, said that if you don’t have the ability to compete, then don’t complain. If you cannot
compete, you will have to face elimination. Or if you cannot stand the heat, stay away from
the kitchen. Indeed, Stanley Ho said that one third of his VIP rooms were facing closure. He
wanted the government to exercise control over the growth of the American companies. He
was afraid that the Americans would become a leading player in Macau’s economy.
Furthermore they would try to influence Macau’s politics after that.28
For the above information, see Bertil Lintner’s article, “Stanley Ho’s Luck Turns Sour,” first published by the
Far Eastern Economic Review, May 2007, and then by Asia Pacific Media Services at its website
http://www.asiapacificms.com/articles/luck_turns_sour/, accessed on November 3, 2007.
24
See an article comparing STDM and the Sands Macao, “Ao Bo Shouyi Ju Shou Jin Sha Bei Sheng” （SJM
still makes the most money, but the Sands’ income has doubled,” Macao Daily, April 27, 2006, A1.
25
See “2007 Gaming Results: Market Share Per Operator,” Macau Business, December 2007. MGM Grand was
open in December, so its share was not counted here.
26
See an article on Sheldon Adelson’s lasted comments on the competition between the two, “Jinsha: 09 Nian
Qian Duo Liucheng Shichang” (The Sands will take 60% of the market by 2009), Macao Daily, Sept. 4, 2006,
A10.
27
See “Aobo Jiuyue Du Shou Sheng 10%” (SJM sees an increase of 10% in September), p. A10, Macao Daily,
October 5, 2007.
28
See an article on the exchanges between Stanley Ho and Sheldon Adelson accusing each other, “Aidesen: Wu
Jingzheng Li Taotai Nanmian; He Hongshen: Mei Zi Gongsi Wu Dui Chengnuo”, Macao Daily, Aug. 29, 2006.
23
8
Ho’s accusations and worries are finding echoes in people with strong nationalist feelings.29
Some have begun to talk about “re-colonization” or “the new Opium War.” Others have
talked about Macau, especially the American companies, drawing blood from the Chinese
mainland, which is still relatively poor. In the Chinese Communist Party’s 17th Congress in
October 2007, Chairman Hu Jingtao stated that the Chinese government will guard against
the interference of outside forces in the businesses of Hong Kong and Macau. Quite a number
of opinion leaders and politicians in Macau have appeared on TV programs and written in
newspapers to blame the American companies for causing the current social problems in
Macau, including inflation, skyrocketing housing prices, congested traffic, etc. And they are
warning that the American businesses have interfered in the government’s policymaking and
hurt local businesses (including the gaming business), and they will eventually cause political
problems in Macau since they will create their own representatives in the legislature. In the
end, they will control the politics and economy in Macau and hurt the central government’s
policy of “one country, two systems.” And the central government’s another guiding
principle of “Macau to be governed by Macau people” will be in jeopardy. 30 So we are seeing
more nationalist complications.
It is an interesting case study of the triple alliance among the TNCs, local capital (in this case
SJM), and the state. How would the Chinese central state and local Macau government
handle this issue? We know that one of the reasons why the Sands was granted a concession
is Sheldon Aldelson’s help with the Chinese government to win the bid for the 2008
Olympics in Beijing.31 That’s an alliance. The Macau government is also happy to see the
Sands’s role in diversifying the gaming industry. That’s an alliance, too, and an example of
dependent development. But the nationalist feelings on the part of the local capital and local
community are also issues that all parties have to deal with. It is interesting to see how things
will evolve, and in what way they will affect the socioeconomic development of Macau. We
will come back to this point in the next part.
Third, there is problem gambling and the issue of responsible gaming on the part of the
casino operators. For most developing countries, the price they are paying for
industrialization is often environmental nightmares. For Macau, the price it’s paying for more
development is problem gambling. The Institute for the Study of Commercial Gaming at the
University of Macau researched the gaming activities of Macau citizens in 2003.32 Out of a
representative sample of 1,121 Macau residents, ranging from ages 15 to 65, the researchers
found that two thirds of the respondents participated in at least one kind of gambling
activities in the year before. While it may be true that most of them might have done it for
recreational purposes, 1.78% could be identified as “probable addicted gamblers” (keneng yi
chengwei bingtai dutu 可能已成為病態賭徒), and 2.50% were “probable problem gamblers”
(可能已成為問題賭徒). If the ratio holds, out of 460,000 Macau residents at the time, 8,188
For his most recent accusation, see “Aobo Rongzi 50 Yi Wei Xin Pujing Meiwei” (SJM raised 5 billion patacas
for the final stage of the Grand Lisboa project), p. A10, Macao Daily, October 5, 2007.
29
See also Ye Guilin, “Zhong Mei Guanxi zhong de Aomen Yinsu: Jiyu Guoji Zhengzhi Jingji Xue de Fenxi”
for more discussion on nationalist feelings.
30
See an article making all these warnings by Chow Kam Fai, a legislator associated with Stanley Ho’s SJM,
“Aomen Fanrong de Beihou,” Macao Daily, October 26, 2007, E12.
31
See “Sealed information could put Sands Macau gambling license in jeopardy” in Macau Daily Times, p. 4,
October 9, 2007.
32
See Feng Jia-chao and Wu Mei-bao, “Aomen Jumin Canjia Bocai Huodong Diaocha” (A study on Macau
citizens’ participation in gaming) (Macau: Institute for the Study of Commercial Gaming, University of Macau,
2003).
9
would fall in the first category, and 11,500 would fall in the second category. With the
population increase, the figure must be higher now. And that is not including the gamblers
from mainland China, who constitute the majority of the people gambling in Macau’s casinos.
To prevent people from getting into gambling problems and help those who have become
addicted to overcome addiction has become a daunting task for the Macau society, including
not only the actors in the triple alliance, but also the Macau community at large.
The problems of such gamblers can be seen, indirectly, from the following Hong Kong
example. In the year between 2003 and 2004, Ming Ai Zhan Qing Center 明愛展晴中心, or
Caritas A G Counseling Centre, of Hong Kong helped 350 addicted/problem gamblers who
came to them the first time. Each of these persons still had a debt of 200,000 to 300,000
Hong Kong dollars. Half of them were addicted gamblers. Fifty of them had thought about
suicide.33 Kung Yick, a former Nationalist officer stranded in Macau, lost his initial U.S.$3
million, the money given to him by the Nationalists to help people escape from the mainland,
in a gambling career of 40 years. He died in 1998 penniless, although he had no regrets for
his gambling sprees.34 One constantly read and hear stories of people, both in Macau and
mainland China, who lost their businesses and/or families because of gambling.
3. SOLUTIONS TO THE PROBLEMS AND DEPENDENT DEVELOPMENT
As Gereffi and Fonda point out, “The essence of development is to improve the quality of life.
This generally calls for higher incomes, which are the result of gains in productivity and
technological advances among nations. Economic progress, in turn, depends on a number of
other development objectives: better education, improved health and nutrition, a cleaner
environment, a reduction of poverty, more equality of opportunity, an enhancement of
individual freedoms, and a richer cultural environment.”35 These may be called economic,
social, cultural, and political goals of development. So when discussing the solutions to the
problems, we need to keep these goals in mind, whether we are talking about the survival of
small and medium-sized enterprises, the nationalist conflicts between foreign and local
capital, or problem gambling.
As we mentioned at the beginning of the paper, Macau government has an ever increasing
reservoir of funds and it has an opportunity to use the money wisely for the city’s
development. Some have argued that the government should provide more welfare to the
elderly and build more economic housing for the local Macau people who cannot afford the
extraordinarily priced houses now. Others have argued for building the infrastructure that is
sorely lacking in Macau. It appears that the government is thinking about or beginning to do
all of these things, but it’s not clear how effectively these projects can be carried out. But we
want to focus on the three problems we raised in this paper.
First, how can the majority of Macau’s enterprises cope with their human resource strain
caused by competition and prosper in this globalized market? They seem to be facing two
kinds of challenges. On the one hand, they need to make their businesses more competitive.
This means that they will have to bring their services on par with international standards so
that they can compete with the services provided at the casinos. For example, the food
See “Wenti Dutu Pingjun Qian Zhai Ershi Wan” (Problem gamblers on the average had a debt of
HK$200,000), Macao Daily, 10/15/04.
34
See an interview with Kung Yick in Jill McGivering, Macao Remembers (Hong Kong: Oxford University
Press, 1999), pp. 129-32.
35
Gereffi and Fonda, “Regional Paths of Development,” p. 420.
33
10
industry has to make their environment more welcoming to customers and their food more
appealing to a wide variety of visitors from all over the world.36 On the other hand, they need
to provide more benefits and better working conditions to their employees so that they can
retain them. If they can do the first better and make more money that way, they will be able
to do the second better. Only by doing these things can they stay afloat and survive in the
competition. And by meeting these challenges, they will also be contributing to the
diversification of Macau’s economy.
Of course, it’s easier said than done. Faced with the need to transform their services, the more
ambitious ones are getting small loans from the government to upgrade their businesses and
are doing pretty well. But others are facing closure: small shops are increasingly replaced by
chain stores. Still others see a drop in their earnings. All of them feel the squeeze of human
resource shortages. 37 This may seem to be a good thing in bringing Macau’s economic
development to a higher level. But it can also arouse feelings among the local capital. We
occasionally hear small and medium sized enterprises complain that the government is not
doing nearly enough to help them survive in the market. But other than that, they seem to be
taking it for granted that they will have to take care of themselves in the current
transformation of Macau’s economy. In the past two years, people have taken to the street to
protest the importation of migrant labor, skyrocketing housing prices, traffic laws, corruption
in the government, etc. 38 But the conflict between this part of the local capital and
transnational capital has not figured as important.
Second, how would the conflict between the gaming part of the local capital and gaming part
of the foreign capital be resolved? While Stanley Ho is complaining about unfair foreign
competition, he is quietly improving his services as other casinos do. Ironically, competition
and conflict might actually lead to improvements, and conflicts can thus be melted, to some
extent.
The first of such improvements is in the diversification of the gaming industry. Rather than
focusing on the gambling itself, the casinos have been trying to add other components to their
operations. Indeed, when they were granted the concessions, the casinos were required to
invest in other operations than gambling, such as convention, shopping, and other
recreational areas. SJM, for example, would build Macau Fishermen’s Wharf, Ponte 16, and
East West Cultural Village.39 The first two projects have basically been completed, but not th
last one yet. Meanwhile, The Venetian Macao has opened its convention center, which offers
one million square feet of convention and exhibition facilities, one million square feet of
shopping center with 350 stores, a 15,000 seat stadium, 20 leading restaurants, as well as
Gondola rides.40 All the new developments like these will diversify Macau’s gaming industry
like never before. They provide convention centers and entertainment activities other than
just gambling. What the other four major players (The Wynn Macao, The Galaxy, The MGM
The food industry is already feeling the strain. See an article “Huangqin Zhou Ao Dan Jie Wang” (Both
Macau and Taipa saw business increase in the weekend of October 1), p. A6, Macao Daily, October 8, 2007.
37
See Macao Daily (October 29, 2997, A10) for a number of newspaper articles reporting the dilemma faced by
small and medium sized enterprises.
38
See Bill K.P. Chou, “The Paradox of Macao’s Development,” a paper presented at the First Seminar in Law
and Social Sciences, co-sponsored by the University of Macau and the Universidade Estadual Paulista-UNESP
of Brazil, on October 30 and 31, 2007 at the University of Macau.
39
See McCartney, “Casino Gambling in Macao,” p. 53.
40
See The Venetian’s website at http://www.venetianmacao.com/en/home.aspx, accessed on October 9, 2007. It
receives 50,000 to 60,000 visitors each day now since its opening in August.
36
11
Grand Macao, and Melco PBL) will do in the same regard is not yet clear. 41 But the trend
seems promising. And it’s a progressive part of dependent development.
Las Vegas has witnessed the following marketing tools to attract visitors: Grand Prix and
Formula One Auto Racing, Boxing matches, golf tournaments, tennis tournaments, musical
concerts, New Years Eve parties, etc., and it is the world’s honeymoon capital and a vacation
destination for many families.42 One point of introducing foreign capital is the diversification
of the gaming industry, and apparently more can be done. For example, one might argue that
the diversification of the industry provides an opportunity for Macau to protect its World
Heritage Site and change the image of “a city of sin” into one of “a city of culture.” But this
is only an opportunity. How the gaming industry can associate with the World Heritage Site
is not yet clear. Can casinos expand their cultural component by integrating the local
historical contexts into its entertainment part? We know that The Venetian has incorporated
the Venetian culture. But not many have thought about incorporating the Macau
Portuguese/Chinese culture. For MGM Grand Macao to simply build its grand lobby in the
style of the Portuguese Central Train Station with a Portuguese garden is a good start, but it is
probably still too little, too symbolic, and too simple. How will the casinos diversify their
own operations? Will the government endeavor to compete with the casinos in getting
people’s attention on or to ask the casinos to include in their entertainment part Macau’s
World Heritage Site?43 In the triple alliance between the state, the multinational corporations,
and the local capital, the government probably needs to take a stronger stand in promoting
Macau’s culture. So can gambling and this other kind of “World Heritage” mesh? If so, in
what way? Is foreign capital here only for money, or will it be able to promote one of the
cultural goals of development as we mentioned above? This we still have to see.
The second improvement derived from the conflict between foreign and local capital is the
establishment of rules and regulations regarding the gaming industry. Take the credit system
for example. Before 2004, it used to be illegal to lend money to gamblers, no matter by whom,
although such practice was tolerated in reality. When Wynn Resorts came to Macau, it
insisted that the gambling credit be made legal, and it has been since then.44 This made it
possible for the creditors to pursue debtors through the court of law, something they can do
now in Macau but not in mainland China since gambling is still illegal there. 45 More such
rules might help prevent loan-sharking, criminal kidnapping, and even murder involved in
such activities.
The Fishermen’s Wharf has been hosting medium to small size conventions since its opening in 2006, over
25 of them by the end of first half year of 2007. It’s less expensive to have conventions in Macau than in Hong
Kong, where the prices will double. Apparently, the Venetian will attract large conventions in the future. See
“Ao Zhan Fei Ping Lalong Da Zhanhui” (The expenses for conventions are low here in Macau, and large
conventions will be attracted here), p. A10 of Macao Daily, August 27, 2007.
42
See Vincent Eade, “Las Vegas Gaming Trends Analysis” in Vincent Eade (ed.) Overview of Gaming (Tokyo,
Japan: ACE Research Institute, 1996), pp. 207-23. For more on Las Vegas’s games, shows, foods, etc., see also
Terri C. Walker (ed.) The 2005 Casino and Gaming Market Research Handbook, 8th edition (Atlanta, GA: Terri
C. Walker Consulting, Inc., 2005), pp. 237-51.
43
An article by Chen Limin raises the same point. See her article “Ben Ao Shi Yi Quefa Jingji Xiaoyi?” (The
World Heritage in Macau is lacking economic benefits?), p. A11 in Macao Daily, August 26, 2007.
44
For the reform of the legal system regarding gaming, see Wang Wuyi, “Aomen Bocai Ye Da Fazhan zhong de
Jige Wenti” (Several issues in the great development of Macau’s gaming industry), pp. 46-7 in Aomen Yanjiu
(Journal of Macau studies), Vol. 26, February 2005; see also Guan Hongling and Lei Qiang, “Waizi Jinru
Aomen Bocai Ye Dailai d Shehui Zhengzhi Yingxiang” (The social and political impacts of foreign capital’s
coming to Macau’s gaming industry), p. 69, Vol. 31, Aomen Yanjiu (Journal of Macau studies), December 2005.
45
See “Neidi Falu Bu Baozhan Duzhai Zhuitao” (Laws in the mainland do not guarantee the pursuit of the
debtors there), p. 2 in Xun Bao (Son Pou), August 24, 2007.
41
12
Establishing rules and regulations for the game is all very important. But it will not be an
easy task. For example, can and should the gaming industry form its own association, just
like in the United States, so that it can better self-discipline itself? Liang Anqi, a legislator
associated with the gaming industry, complained that the government promised to organize a
gaming advisory board in 2007, but nothing had happened. Then in the end of 2007, the
government announced its decision to form a gaming advisory committee composed of all the
players in the field, including the casino representatives, government officials, and
community leaders. So there might indeed be a triple or four part alliance. But it remains to
be seen when it can be established and whether it will work. Liang has also questioned the
open-design of the Venetian Macao, where people can freely go to the gambling tables and
machines without security checks. She wants the government to clarify its rules and
regulations.46 As we will discuss below, more areas will need rules and regulations. Of course,
if there are rules but no enforcement of rules, rules would be useless. That is also a challenge
to Macau’s gaming industry.
The third improvement is in human resource management. By definition, human resource
management means the organization of employees as assets in a corporation in such a way
that the employees will be valued as human beings and can be mobilized to do the most
productive work for the company. 47 How does one organize one’s employees, then? How
does one show care to one’s employees? Wynn Resorts has been reported as providing its
employees with a team member support program. This would give its employees 24 hours of
free and confidential hotline support in Cantonese, English and Mandarin as well as training
to help them deal with the various pressures derived from their jobs, including conflict
management.48 In Las Vegas, the dealers at Wynn voted to join the TWU Dealers Local 721
(The Transport Workers Union) for the purpose of collective bargaining and lobbying elected
officials.
It looks that Wynn Macao is doing better than Wynn Las Vegas in terms of its human
resource management, although more research still needs to be done to see what the
similarities and differences are between the two locations. Research should also be done to
compare not only the two Wynn properties but also the foreign vs. local Chinese companies
and see whether they are doing similarly or differently regarding human resource
management. We know that under the pressure of international competition, SJM has already
improved its services and human resource practices. There is apparently more room for
improvement, and we just need to find out specifically how. In a recent court case, a former
employee has sued SJM for lost pay in holidays (they did not used to have holidays,
including weekends, annual leaves, Spring Festival holidays, etc. when they worked there—
things seem to have changed now).49 How do Macau’s casinos do in providing employees
with pension plans, free life, health, accident and hospitalization insurance and free meals, as
compared with what they do in Las Vegas?50
See an article on Liang Anqi’s queries, “Liang Anqi Zhixun Bocai Jingying Shoufa,” Macao Daily, October
26, 2007, B8.
47
See a fuller explanation of the term in Vincent H. Eade, “Human Resources Management” in Vincent Eade
(ed.) Overview of Gaming (Tokyo, Japan: ACE Research Institute, 1996), pp. 131-3.
48
For Wynn’s employee support program, see “Yongli Aomen ‘Tuandui Chengyuan Zhiyuan Jihua’ Chuangxin
Biaozhun” in Xun Bao (Journal Son Pou), p. 2, August 17, 2007.
49
See “Qian Ao Yu Yuangong Zhui Jiaqi Bu Xin” (Former employees sued SJM for lost pay for holidays), p.
B8, Macao Daily, September 28, 2007.
50
See Terri C. Walker (ed.) The 2005 Casino and Gaming Market Research Handbook, p. 455.
46
13
If we judge competition and conflict between the local and foreign capital from the point of
view of concrete improvement of quality of life in Macau, then the nationalist feelings we
mentioned earlier are not really as important, unless there is unfairness and injustice involved.
But they are important nonetheless. The gaming industry simply has to do more to alleviate
Chinese nationalist feelings, not only in the above mentioned diversification, regulation, and
human resource management, but especially in preventing problem gambling. We will come
back to the role of the developmental state in the next section, but let us first see what the
gaming industry is or is not doing regarding problem gambling.
The third problem we discussed earlier has to do with problem gambling. Will foreign
investment help here? Will dependent development work in this regard? That brings us to the
issue of responsible gaming. Responsible gaming means not only 1) that the players should
make rational and sensible choices, but 2) that the industry has an obligation to protect the
players by providing rational and sensible products and services so that the players will make
rational and sensible choices, and 3) that the industry has an obligation to contribute to the
overall welfare of society rather than causing problems for sustainable development. This is
also part of the casino’s corporate social responsibility.51 Other than the state, the local capital
outside gaming, and the community organizations, what can the casino operators do to
advance responsible gaming, then? Do they have an obligation to help individuals, including
their own employees and families prevent, intervene, and treat problem gamblers? What can
they do? Harrah’s is an industry leader in responsible gaming since the 1980s. In one of its
programs named Operation Bet Smart®, the Harrah’s stated that they
provide responsible gaming signage on the casino floor and back-of-house so that
employees always know where to refer customers requesting assistance. We also
provide responsible gaming information in brochures, on hold messages, and Harrah's
responsible specific media campaign, as well as including helpline phone numbers on
all marketing collateral, player cards, and hotel directories. These communication
efforts serve to provide our customers an unobtrusive vehicle for obtaining more
information about responsible gaming and seeking assistance.52
Harrah’s has other programs like Self-Restriction/Self-Exclusion, Looking out for Kids, and
Project 21, which “teaches casino employees, minors, parents, and guardians about the
consequences of gambling under the legal age.” Other casinos in the world have taken other
measures. And the state may also set restrictions on where and how casinos can operate.53
See the “Supplementary memorandum from the Royal College of Psychiatrists,” testimony by professors from
the Royal College of Psychiatrists at the British Parliament in 2004, published at the British Parliament’s
website http://www.parliament.the-stationery-office.co.uk/pa/jt200304/jtselect/jtgamb/63/4010807.htm, access
on October 28, 2007. This is the Victoria Gaming Machine Industry's Code of Practice, widely practiced by the
gaming industry. For corporate social responsibility, see Richard Holm and Phil Watts, “Corporate Social
Responsibility: Making Good Business Sense” (The U.K.: The World Business Council for Sustainable
Development, 2000).
52
See Harrah’s website at http://www.harrahs.com/harrahs-corporate/about-us-responsible-gaming.html,
accessed on October 10, 2007.
53
For more measures by the casinos and the state, see Century Casinos’ website at
http://www.cnty.com/corporate/social-responsibility/, accessed on October 29, 2007; see also Linda Hancock,
“Responsible Gambling? A Critique of Australian Responsible Gaming Regulations,” a paper presented at a
seminar organized by the Department of Sociology, University of Macau, on September 19, 2007. She discusses
whether the threat of legal liability will drive new approaches to player protection internationally.
51
14
But research finds that such measures are not effective since the incentives provided by the
industry are far more powerful than their warning signage or other restrictions. So these
measures have to be accompanied by other controls such as the limit of money one can spend
per gambling session, etc. Are Macau casinos and the government doing anything like that?
Not really. The Sands Macao and The Venetian Macao seem to have some kind of initial
steps in the way of responsible gaming, but not much has been done.
Furthermore, over 70% of the casino revenue comes from the high rollers, who bet thousands
upon thousands of dollars. And they bet in the VIP rooms.54 Comparatively speaking, in Las
Vegas, the high rollers generate only 40% of the revenue.55 If the money comes from their
own pocket and they can afford it, it’s probably OK to do it. (Still we read too many tragedies
here.) But if they bet on embezzled money, it would be a more pubic issue. Of course, it is
hard for casinos to know what money is legal and what is not. But there are things they can
do. They certainly know who is spending how much, and they know the identities of these
people, too. They can certainly put a cap on mainland cadres or private business owners as to
the amount of money they can bet in their casinos.
It’s true that it may be the middlemen and women who are controlling the money transactions,
not the cadres themselves, but the casinos have leverage on the middlemen and women. If
they want to control who is in their properties, they can control the middlemen and women,
who can then control the betters. This of course goes in conflict with their business instinct to
make as much money as possible. And it may be in conflict with some privacy laws. But
some kind of compromises should be found to deal with the problem. If the casinos are
responsible businesses, they should make efforts to stop illegal money from flowing into their
pockets by using responsible gaming practices.
In the triple alliance, the government can also do something in this regard since the
middlemen and women, numbered 3861, are licensed by the government.56 In summer 2007,
the Guangdong government also ordered to limit the visa to Macau by their government
officials. This is certainly one way to deal with the problem, even though the corrupt officials
and corrupt casino business operators can find other ways to avoid being caught.57 And the
number of corrupt officials can be large.58 So some concerted efforts by all parties have to be
For the operations of the VIP rooms, see Wang Wuyi and Peter Zabielskis, “Making Friends, Making Money:
Macau’s Traditinal VIP System,” forthcoming paper in an edited volume entitled Cultural Perspectives on
Gambling Organizations: Backgrounds, Scenes, Context, 2008. See also Zeng Zhonglu, “Bocai Dazhan
‘Guibing Ting’ Shi Cheng Jiaodian” (In the gaming battles, the VIP rooms will be the focus), p. A11, Macao
Daily, August 26, 2007.
55
See Terri C. Walker, The 2005 Casino and Gaming Market Research Handbook, p. 468.
56
See an article by Li Yan, “Duting ‘Hezuo Ren’ Bushu Wailao Qian Dipan” (The middlemen and women are
not non-Macau resident labor and are not competing with the locals), p. 4 in Xun Bao (Son Pou), August 10,
2007.
57
See Li Yan, “Yue Sheng Daji Guanyuan Jingwai Dubo Wei Jian Fangsong” (Guangdong province has not
relaxed its efforts in curbing officials gambling outside the mainland), p. 6 in Xun Bao (Son Pou), September 21,
2007.
58
Bill Chu, Harrah’s Asian regional marketing director, says that he brings 100 to 500 Chinese players a month
gambling in the $30,000 to $100,000 category. See Terri C. Walker, The 2005 Casino and Gaming Market
Research Handbook, p. 467. That may be exaggerating, but by the same token, more such players would come
to Macau, since it is so close and so convenient. One can imagine the amount of money involved. One does read
frequently stories of mainland officials being tried and sentenced because of their using public funds to gamble
and lose big here in Macau. See also Dai Anna, “Aomen Bocai Shehui Zeren Chutan” (An exploratory study of
the social responsibility of Macau’s gaming industry), p. 107 in Aomen Yanjiu (Journal of Macau studies), Vol.
40, June 2007.
54
15
put on the table. Private gaming salons like the VIP rooms in Las Vegas do not have
popularity and contribute little (at least not the most) to the casino revenue there.59 If Macau
wants to reverse its image of out-of-mind gambling, it may have to decrease the share of the
exclusive betting parlors. But the trend seems to be the opposite. Here dependent
development faces serious challenge. Dependency does not yet mean development here.
4. THE IMPORTANCE OF THE DEVELOPMENTAL STATE AND THE LOCAL
COMMUNITY
From the discussion in the previous sections on the problems and solutions in terms of
competition faced by the small and medium-sized enterprises, the conflict between local and
foreign capital, and prevention of problem gambling, we understand that the government has
not played a strong role. Neither does the community. So we will have a more detailed look
at these two players in Macau’s socioeconomic development.
As Xie Side points out, in the past eight years, Macau SAR government has largely followed
a laissez faire policy in its relationship with the market. This can already be seen from the
Chief Executive’s 2000 state of Macau report. He said that the government would let the
market lead the development of the city, and it would protect the normal operations of the
market mechanisms. Does it mean that the government would not do anything at all?
Although the government does not say so, it appears that it’s not doing much. 60 The
government’s role, however, is not necessarily to localize the gaming industry and reject
foreign competition, as Xie seems to be implying. But there does seem to be so many issues
that the Government is not taking actions when it probably should be. Here are a few of them.
First, many legislators have been calling on the government to clarify its labor policies to
help especially the small and medium-sized local enterprises, but the government is still
dragging its feet. The legislature, on the other hand, could not do too much since the political
system gives the executive too much power. Of course, the government cannot take the full
responsibility for the survival of the small and medium-sized companies. As we said earlier,
much depends on how they can enhance their competitiveness. But the government’s role
cannot be ignored, either.61
Second, regarding the competition between the foreign and local capital, the government
needs to play a more open, fair, and just role. For example, in a recent conflict in December
2007, the government granted a ferry operation license to Las Vegas Sands’ Cotai Waterjets
between Hong Kong and Macau. In about a week into operation, the court intervened, and
Sands Macao had to stop the operation because both Pansy Ho, the head of Sun Ta Holdings
Limited and MGM Grand, and Stanley Ho, her father, protested. Stanley Ho says that
granting the shipping license to a gambling concessionaire is against the law, especially when
it was not done in a transparent, tender procedure.62 At a legislative meeting, Liang Anqi, a
wife of Stanley Ho’s, was even complaining that the government was bestowing favor to
certain casino operators at the expense of others (同人唔同命). She complained that the
59
See Terri C. Walker, The 2005 Casino and Gaming Market Research Handbook, p. 244.
See Xie Side, “Bocai Chenggong You Shichang Jueding?”
61
For more discussion on the labor policy issue, see also Leanda Lee, “So hard to find good help these days…at
the right price,” Macau Business, December 2007, p. 70.
62
See Paulo A. Azevedo, “Battleships,” Macau Business, December 2007, p. 27-29.
60
16
government granted the rights to certain casinos (she meant Sands Macao) for land
development (she meant the Cotai Strip), more import of foreign labor, and more convenient
ways of recruiting mainland workers, etc.63 Apparently, the government has not done nearly
enough in regulating the gaming industry and balancing the business interests of foreign and
local capital. (Cotai Waterjets resumed operation about a month later.)
Third, the government has done even less in requiring the casino operators, local or foreign,
to practice responsible gaming. As we mentioned above, both the casino operators and the
government are increasing their incomes, but no one has seriously thought about preventing
problem gambling. Given the control measures that are increasingly taken in other parts of
the world, for example, Great Britain, Australia, the U.S., they cannot just claim ignorance or
pay lip service to such matters. This is one of the most important components of dependent
development; otherwise, dependent development would largely fail.
As Jose I. Duarte points out, current problems seem to indicate that “too many discretionary
decisions were taken without proper or explicit justification,” and public services seem to be
“overwhelmed by their current tasks” and the government is “unable to anticipate
consequences of public decisions or to adequately plan even for foreseeable outcomes.” He
suggests that there might be possible structural or political obstacles hindering the
government’s performance. Autonomy and responsibility need to be better designed and
adequately respected, and “competence and dedication must be properly recognized and
rewarded…” 64 This probably calls for more democratic reforms of the government.
In addition to the role of the government, the community at large needs to be more aware and
more active in affecting Macau’s socioeconomic development. Indeed, Macau has over 4,000
social organizations. But most of them are not active, and those that are active tend to be progovernment, an alliance that is more likely to promote “harmony” than development. For
example, the workers’ associations, women’s associations, and neighborhood associations are
three of the most powerful social organizations. They were normally in opposition against the
Portuguese Macau government. But after the return of Macau to China, they shifted their
loyalty to the Macau SAR government, and are seldom in conflict with it. They are, for
example, against more democratic reforms to make the government more responsible. We
mentioned several demonstrations, but they were organized by several pro-democracy
organizations or new and small independent unions or citizen groups. The mass media in
Macau are also mild even in their criticism. They are afraid of rocking the boat.65 It is true
that there is plenty of discontent in Macau, but much needs to be done to turn it into
productive forces to help enhance dependent development, including more democratization
of the political system.
5. CONCLUSION
In this paper, we have discussed some theories of development, especially dependent
development and the developmental state. We have also discussed the problems of the
gaming industry in Macau and their solutions. We have emphasized the importance of the
state and community organizations. We do see some problems with the internationalization of
the gaming industry in Macau, or the introduction of foreign capital in the forms of Las
See Xie Side’s above cited article.
Jose I. Duarte, “Vicissitudes,” Macau Business, December, 2007, p. 33.
65
For the need to build a strong civil society, see my book manuscript, A City of Sin or a City of Culture: A
Critical Evaluation of Macau’s History and Society, especially the chapter on social problems.
63
64
17
Vegas style casinos. These include the strain of human resources and pressure put on the
local small and medium-sized enterprises, conflict between local and foreign capital, and
increased problem gambling. But we also see that the pressure put on small and mediumsized companies may actually help them to enhance their competitiveness. The conflict
between the foreign and local capital can lead to improvements in the diversification of the
industry and in human resource management practices. We also see the establishment of
better rules and regulations that govern the industry. There are, however, still many problems
that the state and the industry are not doing nearly enough in solving, such as the
diversification of the gaming industry and prevention of problem gambling. Only when these
problems are resolved to a great extent can the nationalist feelings we mentioned in this paper
be alleviated. The government so far has played a rather week role in Macau’s economic
development, and so does the community organizations as a whole.
As dependent development theories would tell us, it is the interaction between the
multinational corporations, the local capital, the state, and the community organizations that
determines the direction of development. It is the balance and compromise of their interests
and adjustment of their strategies that makes development possible. We need to further study
each player’s strategies and see how a balance can be achieved. For only then can it be a
winning situation for all the players. In other words, transnational corporations will still stay
in the market, but they are only one of the players, and have to be equal, fair, healthy, ethical,
and productive players as well. In a mature economy, which Macau is not yet, the market will
no longer be dependent on any one player. Dependent development will have finished its
historical task, and the goals of local economic, social, cultural, and political development
will have been achieved.