2008 – A crisis that left marks. Good and bad.

Could Macau have overcome the effects of the 2008 global crisis without Beijing’s intervention? The truth is that China intervened. In such a way that one can say that the MSAR lost its ‘independence’ at that moment.

Macau Business 2004 – 2019 | 15 Years that changed Macau


September 2008 – The world shook, and many fell.

Macau did not remain unscathed. Many still remember: on a Wednesday in September, hundreds lined up at the door of Luso International and Weng Hang banks, fearing they would lose their deposits in the wake of the rumoured bankruptcy of these institutions – in less than 24 hours about MOP1 billion (at least MOP600 million in Weng Hang and MOP300 million in Luso International Banking Ltd) were drained.

The rumours “have no basis,” Anselmo Teng, then chairman of the Monetary Authority of Macau said, reiterating that the MSAR was “unaffected” by the global financial crisis.

The first explanation, if not total at least partial, was really silly: on the morning of the 24th several banks did not open their doors because of the effects of Typhoon Hagupit (Signal No. 8), which flooded a large part of the Inner Harbour, wreaking much damage across the city.

Of course, Macau’s banking system held out and the scaremongering dissipated.

But the global crisis brought also good news: it was because of this that the government created the wealth partaking scheme, which still benefits all residents and non-residents. And it was because of the 2006 global crisis that for the first and last time housing prices went down (2009).

“The loss Macau incurred directly from the 2008-09 crisis amounted to MOP600 million due to the bankruptcy of Lehman Brothers, while Hong Kong people suffered much more from this event with several billion Hong Kong dollars senselessly lost,” Xinhua Gu, department head and Associate Professor of Economics at the University of Macau, explained to Macau Business.

But it was in gaming that the crisis was most felt.

In June, Galaxy dismissed 270 local casino workers, including some dealers. In November, Sands, after reducing the salaries of its casino staff by 13 per cent, suspended construction of some of its mega hotels and malls on the COTAI Strip. About 10,000 construction workers were laid off – 4,000 from Hong Kong, 4,000 from Mainland China and 2,000 from Macau (27 per cent of the total local construction workforce).

“The global economic crisis began to have a profound impact upon Macau’s economy,” is the opinion of U.W. Tang and N. Sheng, both University of Macau teachers.

‘In 2008, the global financial crisis plunged Macau’s casino industry into an unprecedented slump. There was almost a palpable fear about ‘how the city would retain its prosperity’, state Yufan Hao, Li Sheng and Guanjin Pan, the authors of Political Economy of Macau since 1999 – The Dilemma of Success.

For all this, 2008 was also the year Macau lost its economic ‘independence’ from China. Given the difficulties experienced by some gaming operators, Beijing intervened. In force. First, it became more difficult for Mainland citizens to use the Individual Visit Scheme (launched in 2003) to enter the Macau SAR. Following that, the response came in the form of a package of measures supported by President Hu Jintao and Prime Minister Wen Jiabao.

A few weeks later Vice President Xi Jinping came to Macau and offered Hengqin.