In 1996, Macao welcomed eight million tourists who brought in revenues of more than 26 billion Hong Kong dollars. One year later in 1997, Macao was still able to attract seven million tourists despite of the negative impact of the Asian financial crisis. The steady, cash-infusing tourist industry has been built up even though Macao lags behind other tourist centres in resources such as stellar natural surroundings and an abundance of cultural relics.

But local authorities have worked hard to preserve the limited historical relics scattered around the territory. That, and the construction of new tourist spots and resorts, have helped attract more visitors.

The race for tourist dollars also includes the region's attempt to make a name for itself as the "city of culture and recreation" and gear itself more toward hosting the growing numbers of international events that are held in Macao. The Macau Grand Prix motor race is held every year and attracts numerous spectators from around the world.

The territory's international music festival is another well-known event. The diverse musical performances by artists from around the globe have added one more attraction for visitors to Macao.

Apart from those two events, an international fireworks festival, arts festival, dragon-boat-rowing competition and international marathon fill up the local calendar of events. They help boost Macao's name on the international stage.

There are more than 100 hotels in Macao. Many of the hotels boast state-of-the-art facilities and are operated by management from Hong Kong.

And you can't talk about Macao's tourism without mentioning its unique recreation business that centres on gambling.

The seeds of the gambling industry were sown in the middle of the last century, when Hong Kong rapidly took over the role Macao once played as an important international trading link between the East and the West. In an attempt to dig itself out of recession, the resource-limited local economy in Macao turned to an alternative direction, and the gambling business was born.

But it wasn't until the 1960s that gambling became legal in Macao. From then on, the territory has developed into one of the world's biggest gambling capitals.

Gambling in Macao is run by a few government-approved companies. The scope of gambling includes casinos, horse and dog racing and lotteries.

The nine casinos on the Macao Island and Taipa bring in 80 percent of the industry's annual revenues. More than six million tourists visit Macao's casinos every year, half of them from Hong Kong. The gambling industry also accounts for nearly half of the Macao government's tax revenue.

But even as gambling has given birth to a lucrative industry in Macao, it has also created social problems. Gambling is often blamed for most of the security problems in the region.

The central government has promised that after the hand-over in December, Macao will be allowed to continue promoting its existing recreation industry. The central government has also pledged to assist the future Macao SAR in continuing its efforts in resolving its problems with law enforcement.