Hong Kong and Macau: Demonstrations and Celebrations By Ken Adams, CDC Gaming Reports July 28, 2019 at 7:53 pm Macau is preparing to celebrate the twentieth anniversary of its reunion with Mainland China after four hundred years under Portuguese control. The celebration is scheduled for December; China views it as a significant milestone. Chinese President Xi Jinping is planning to be on hand to make speeches, congratulate everyone and celebrate the success of Macau as a Special Administrative Region of the People’s Republic of China. Macau and China are working together to build the “belt and road” and the “Greater Bay Region.” As great as everything seems, casino operators are a little nervous. President Xi could announce policies that are not favorable to the gaming industry or the continued independence of Macau’s economy. The civil unrest in Hong Kong is casting a shadow over Macau’s celebration preparations. Hong Kong, like Macau, is a Special Administrative Region. Both Hong Kong and Macau are part of China, but they have separate governments, laws and economic systems. The Chinese call it “One country, two systems.” The cities have capitalistic economies and a separate set of laws. However, they are very different in other ways.Hong Kong was part of the British Empire for 150 years. It has a very strong history of democracy, freedom of speech and choice. Hong Kong has 7.4 million people and a strong and diverse economy. The people of Hong Kong see their city as more of an international city than a Chinese city; they do not bear Chinese rules easily. Recently, protests and violence erupted in Hong Kong over a proposed law that would allow Communist China to extradite citizens of Hong Kong to China for criminal offenses. Hong Kong views the law as a threat that puts its citizens under Chinese jurisdiction, bound by laws contrary to Hong Kong’s traditions. For example, China is pushing to make “false news” a crime. The categories of false news might include social media posts and telephone messages, rumors, gossip or speculation. The possibility of losing the freedom of speech is frightening in Hong Kong. Macau, with a smaller population of 800,000 does not have a liberal political history; it has a business tradition. If people in Hong Kong care about freedom of speech, people in Macau care about freedom of commerce. Macau’s economy is robust, even if it is one-dimensional built on casino gambling and tourism. Casino taxes constitute 90 percent of the city’s revenue; Macau has a significant surplus every year. The city has over $50 billion in cash reserves. There are few dissenters in Macau. In Macau, the extradition law barely made a ripple. Macau is not likely to erupt into demonstrations any time soon. Its citizens are focused on jobs, retirement, education and healthcare; all of which are abundantly available. Those things are available because the government has money and it has money because of the casinos. The casino operators regardless of countries of origin are not interested in disrupting the status quo. The casinos are trying everything they can to please the Chinese government in preparation for the gaming license renewals in 2022. In the last few years they have spent billions on their properties to enhance tourism to fit the Chinese vision for Macau. Wynn Resorts and MGM have recently announced new and even bigger and more expensive projects set to begin after they receive their license renewals. The situation in Hong Kong is potentially threatening to the stability of Macau, at least by implication. The government of President Xi has not taken any military action, yet. The Chinese army is said to be watching closely. If China imposed martial law in Hong Kong, China might also consider stronger restraints on Macau. However, that is not likely. The government of China is like the government and citizens of Macau, it does not want to distribute the flow of cash from the casino or harm the growing tourism to the city. Even if the riots in Hong Kong continue, Macau is going to have a celebration that recognizes the greatness of China, the leadership of President Xi and the vibrance of Macau. China will be highlighting Macau’s importance in its overall economic strategies. This year Macau can also serve as a balm on the black eye China is getting from Hong Kong.