Los Angeles (Reuters) – Leading U.S. casino companies are increasingly looking overseas as domestic growth slows, with the Chinese gambling resort of Macau emerging as the biggest potential expansion engine.

Operators from Las Vegas Sands Corp. to Kerzner International are investing heavily in foreign markets including Singapore, with Macau taking the limelight as a destination which could soon rival Las Vegas in size.

„In general there’s more growth outside the U.S. than inside the U.S. in terms of new or expanded markets,“ said Joe Greff, an analyst with Bear Stearns & Co. at the Reuters Hotels and Casinos Summit in Los Angeles.

Las Vegas and Atlantic City, New Jersey, the two main U.S. gambling resorts, are both forecast to grow slightly faster than U.S. gross domestic product over the next few years, said William Schmitt, an analyst at CIBC World markets.

Macau, meanwhile, is expected to grow at a compound annual growth rate of 15 percent from 2004 to 2010, when the market could total $ 13 billion a year, he said.

That is more than double the $ 6 billion that Las Vegas Strip casinos won from gamblers last year. Currently the Macau market is slightly smaller at about $ 5 billion.

Another investment bank, Jefferies & Co., projects that the Macau gaming market could hit USD 12.9 billion in 2008, and later grow to USD 15 to USD 16 billion, bolstered by high-end projects in a market that currently focuses on day-trippers, and new ferry, rail and bridge infrastructure that will boost access from nearby Hong Kong.

Within the U.S., meanwhile, state laws have restricted the potential for casino developments to a few choice markets such as Pennsylvania, whose government is licensing operators to build slot machine-only casinos at select locations.

Las Vegas Sands, which was the first U.S. operator to open in Macau, reported on Tuesday that its fourth-quarter casino revenue there rose 61.3 percent to USD 270 million, adding that China planned to raise the number of mainlanders eligible for visas to visit the island resort.

„These kinds of metrics continue to support the bullish outlook for Macau and justify our investment there,“ Las Vegas Sands President and Chief Operating Officer William Weidner told analysts.

MGM Mirage Inc., the world’s second-largest gambling company, and Wynn Resorts Ltd. are both also opening casinos in Macau.

In Singapore, which last year lifted a ban on casinos in order to boost tourism and create more jobs in the services sector, four consortia are bidding for the first of two planned casino resorts.

MGM Mirage Chief Executive Terry Lanni and Gary Loveman, his counterpoint at Harrah’s Entertainment Inc., the world’s largest gaming company, estimated bids in Singapore at between USD 2.5 billion and $ 3.5 billion and USD 2 billion to USD 3 billion, respectively.

Lanni told Reuters that MGM, together with local partner CapitaLand, has a good chance of winning authorities‘ backing because it „would be a catalyst for other development.“

That could be just the beginning.

Elsewhere in Asia, „I imagine Singapore and Macau will further act as a springboard for other markets to open up,“ Greff said.

Still, Lanni said a preponderance of Muslims in countries like Malaysia and Thailand could limit development there due to religious prohibitions against gambling.

Kerzner in Dubai is building a new Atlantis resort, without a casino.

And some analysts are more cautious.

Merrill Lynch & Co.’s David Anders, in a report entitled „Headwinds for Gaming“ issued in December, cited „excessive expectations surrounding Macau casinos“ as one reason a five-year bull market for U.S. gaming companies could potentially end.

In a sign of how political risk can sometimes shatter rosy growth outlooks, the U.K., whose planned gaming reforms U.S. casinos looked to with excitement 12 months ago, seems to have fizzled as a potential gaming market as the number of major resorts has been scaled back.

„That’s just dead,“ Schmitt said. „It’s off the front burner.“

Given a slowing gaming outlook in the United States, though, Las Vegas-based casinos aren’t likely to give up anytime soon on the hope of greener pastures outside their home market.