How Macau is riding Hengqin’s wave
With construction work now well underway on China’s latest Special Economic District, Hengqin New Area, the island itself won’t be alone in reaping the rewards of its redevelopment, with neighbouring Macau set to benefit as well.
Since being designated as a Special Economic District by China’s central government in 2009, Hengqin Island has become a hive of construction activity, with the south of the island due to be redeveloped as a major tourist destination.
It has been predicted that Hengqin’s population will rise from a few thousand residents at present to around 280,000 by 2020, and that its ecologically themed Ocean Kingdom resort alone will ultimately attract 20 million tourists.
Reducing the risk
Although Macau’s gambling sector has been booming in recent times, analysts and industry figures alike feel its reliance on rich VIPs (who typically can account for around 70 per cent of a casino’s revenue) could leave it exposed to sudden changes in the market.
With a bridge already existing between the two islands (which is due to be supplemented by an undersea tunnel in 2012), it is felt the emergence of Hengqin as a major commercial zone and tourist destination will enable Macau’s casinos to bring in more mass-market customers – especially as gambling will be prohibited on Hengqin itself.
A diverse future
Nor is it just in the direct sense that Macau is likely to benefit. With land in short supply in Macau, and with flexible immigration and tax policies in place between the two islands, Hengqin’s redevelopment should enable Macau to diversify economically, creating new job opportunities for its workforce and leaving it less vulnerable to fluctuations in the gambling-orientated tourism market.
Additionally, Macau University’s new campus will also be situated on Hengqin. Although as this will continue to fall under Macau’s jurisdiction, the campus will be self-contained, and only accessible via a tunnel from Macau itself. Nevertheless, it seems Macau can only benefit from the rapid expansion of its neighbour.