Macau's Gambling Industry: COVID-19,regulatory policies and prospects in a changing environment

Macau has developed over the years into one of the world’s most important gambling destinations and it is incredible to observe how the gaming industry has transformed the region’s economy, urban fabric and political system. This thesis was created with the intention of analyzing the birth, expansion and prospects of the industry, highlighting the role that both historical, political and economic factors have played in its development and the contemporary challenges that are redefining its growth model. Macau’s gambling industry originated during the period of Portuguese colonization, with its legalization and subsequent regulation in the 19th century. After Macau’s return to China in 1999, Macau assumed the status of a Special Administrative Region, a status that allowed the city to maintain a high degree of economic and political autonomy, thus facilitating the liberalization of the gambling industry in 2002. The liberalization of gambling industry led to the entry of numerous international operators that led to an unprecedented growth of this sector, thus making Macau the largest gambling market, by gross gaming revenue, internationally. In the course of the chapters, we will analyze how the development of casinos has had a significant impact on the urbanization and use of the city’s space, which is limited both in terms of extension and building space, influencing the start-up of reclamation projects, such as that of the Cotai Strip aimed at the expansion of tourist facilities and activities related to the gaming industry. However, this exponential growth has also generated critical issues, including the rising cost of living, high housing density and pressure on infrastructure, strongly affecting the quality of life of the city’s residents and leading to a relentless search for space. In recent years, Macau’s gaming industry has been confronted with two crises: the COVID-19 pandemic, which drastically reduced the level of tourist flows and revenue, and China’s anti-corruption campaigns, which severely restricted the VIP segment and led to a change in the industry’s organizational and market structure. These events demonstrated in their entirety the vulnerability of Macau’s economic model based on dependence on a single industry. For this reason, the local government of Macau and the central government in Beijing are trying to initiate programs aimed at economic diversification in the region, promoting alternative sectors and regional cooperation within the Greater Bay Area. However, the success of this economic transition will depend on the effectiveness of economic policies and the ability to attract new investments. This thesis therefore demonstrates how Macau’s gaming industry is deeply intertwined with the city’s history and politics and aims to analyze how the city’s future economic sustainability depends on its ability to adapt to new economic and geopolitical challenges.