Jan. 23 (Bloomberg) -- Macau's gaming revenue surged 22 percent in 2006, surpassing the Las Vegas Strip as the world's biggest casino market.

The Chinese city's gambling industry reaped 55.9 billion patacas ($6.95 billion) in revenue, according to the Web site of the industry regulator. Analysts estimate the Las Vegas Strip took in between $6.5 billion and $6.6 billion last year.

Macau's gambling revenue started to surge in 2004, when Sheldon Adelson's Las Vegas Sands Corp. and Galaxy Casino SA ended the four-decade monopoly of billionaire Stanley Ho. Foreign investors are staking $20 billion on making the city, a former Portuguese colony, into the gambling capital of Asia.

``Macau is growing at a much more rapid pace than the Las Vegas Strip,'' said Rob Hart, a Hong Kong-based gaming and property market strategist for Morgan Stanley who estimated the U.S. city's gaming 2006 revenue at $6.5 billion. ``They've got a lot of new casinos opening this year.''

Seven new casinos opened in Macau last year, bringing the total to 24. The number of gaming tables doubled in the period to 2,762, according to the Web site of Macau's Gaming Inspection and Coordination Bureau.

The State of Nevada's Gaming Control Board, which regulates the Las Vegas gambling industry, is yet to release full-year figures. Las Vegas Strip gambling revenue gained 15 percent to $6.4 billion in the year through June, the board has said.

Surging Revenue

In the fourth quarter, revenue surged 43 percent from the year before to 16.6 billion patacas. Macau's gaming revenue in the three months to Dec. 31 almost matched its performance for all of 2000, when it had 17.1 billion patacas for the entire 12 months.

The city attracted 22 million visitors in 2006, an increase of 17 percent from 2005, according to statistics released on Jan. 17 by Joao Manuel Costa Antunes, director of Macau's tourism office.

In total, 2.2 billion people live within five hours' flying time of Macau, according to CLSA Asia-Pacific Markets, compared with 410 million in the same radius of Las Vegas.

Adelson said he recouped his $260 million investment in Macau in eight months.

Wynn Resorts opened the $1.2 billion Wynn Macau in September on the Chinese island. The Las Vegas-based company, operated by billionaire Steve Wynn, also plans to build a second casino there. Kirk Kerkorian of MGM Mirage is also building a new resort in the city.

``Macau is a staggering market,'' MGM Mirage Chief Executive Officer Terrence Lanni, 63, said during an interview earlier this month.

Bright Beacon

Macau now earns 70 percent of its revenue from casino taxes. The economy has doubled in four years to $12 billion.

The city's gaming revenue may reach $8 billion in 2007, mainly driven by the scheduled opening of Las Vegas Sands' Venetian Macao in the middle of this year, Jonathan Galaviz, a partner at Globalysis Ltd., wrote in a report in August. The Las Vegas-based gaming consulting company estimated 2006 revenue in the Las Vegas Strip at $6.6 billion.

``Macau will continue to be the bright beacon of strong casino gaming revenue performance in 2007 even with other jurisdictions in Asia, such as Singapore, continuing to move forward with casino gaming liberalization or legalization,'' Galaviz said in an e-mailed reply in response to questions today.

Singapore Next

Foreign investors are also targeting Singapore, Japan, Vietnam and other Asian countries, as governments move to lift decades-long restrictions on casinos.

The next gambling venue that will open up is Singapore, where in May the government issued its first casino license to Las Vegas Sands. Adelson will spend $3.6 billion building a casino and a 2,500-room hotel and convention center on reclaimed land in Marina Bay, near Singapore's downtown.

In December, Singapore authorities announced that a second license -- the last to be granted for at least 10 years -- had been awarded to Asia's biggest casino company, Kuala Lumpur-based Genting Bhd., controlled by billionaire Lim Kok Thay.

Shares of Star Cruises Ltd., Asia's largest cruise operator, surged as much as 66 percent today after Stanley Ho made a personal investment in the company.

Ho agreed to buy HK$274.8 million ($35 million) of shares in Star Cruises. The company, also controlled by Genting's Lim, will sell a total of HK$584 million of shares to five investors, it said.

Star Cruises also entered into an agreement for Ho's Sociedade de Jogos de Macau to operate a casino in a boutique hotel to be built in Macau.

``There is a much larger population close to Macau than close to Singapore,'' said Hart. ``The Chinese gamblers in the mass market will keep going to Macau because it's much closer than to Singapore.''

To contact the reporter on this story: Clare Cheung in Hong Kong at scheung4@bloomberg.net.

Last Updated: January 23, 2007 02:58 EST