When US billionaire Steve Wynn opened the latest addition to his casino empire in Macau in September, he made sure the residents of the former Portuguese colony in southern China got a show they wouldn’t forget in a hurry. A massive fireworks display erupted around the Wynn Macau hotel and casino on the stroke of midnight, while Frank Sinatra’s „Luck Be A Lady“ boomed out across the man-made lake in the front of the luxury resort.

Wynn, who is credited with pioneering the transformation of Las Vegas from a seedy haunt of gamblers and mafia-types into an all-American family destination, won’t have to wait long to see a profit on his GBP 628m Macau investment. Last week, the tiny territory overtook Las Vegas as the world’s top gambling destination. Macau’s 23 casinos generated £301.8m in revenue in September, GBP 10.4m more than Las Vegas’s 30 casinos, according to leisure industry consultants Globalysis.

Macau’s astonishing rise from a former colonial backwater long overshadowed by its neighbour Hong Kong to the world’s casino capital has been fuelled by the insatiable appetite of the mainland Chinese for gambling. Macau is the only place in China where gambling is legal.

Last year, 10.5 million mainland Chinese went to Macau. Once there, their gambling habits make those of Vegas’s seem like small change. Whereas Las Vegas draws most of its gambling revenue from slot machines, Chinese punters prefer the baccarat and blackjacktables and they play for higher stakes; Macau’s gamblers bet GBP 47 for every GBP 5 wagered in Las Vegas. It’s the reason why Macau’s casinos are set to earn GBP 3.6bn this year, compared to Vegas’s GBP 3.46bn, despite the smaller number of casinos. So much money is being generated that Macau’s annual budget of GBP 1bn is easily covered by taxes from gaming revenue.

Gambling has been legal in Macau since 1847, but it was after Portugal handed the 28.2-square mile territory back to China in December 1999 that its transformation began. In 2002, the Chinese government ended Hong Kong tycoon Stanley Ho’s 40-year gambling industry monopoly and granted licenses to Wynn and the Las Vegas Sands Group, headed by magnate Sheldon Adelson.

Although Las Vegas is set for a GBP 10.4bn facelift over the next five years, it may already be too late for it to reclaim its crown as the world’s gambling capital. With three billion people, almost half the world’s population, living within a five-hour flight of Macau, Vegas’s location in the Nevada desert makes it seem isolated in comparison.