Loading
Associe-se

Fitch predicts 48% growth this year for Macau’s economy

Homepage > Fitch predicts 48% growth this year for Macau’s economy > Fitch predicts 48% growth this year for Macau's economy
Fitch predicts 48% growth this year for Macau’s economy
Published in 31 March, 2023
Share

The Fitch Ratings agency forecasts that this year the public deficit will be 10.5 percent, an improvement on last year, when it reached 35.5 percent of GDP. 2023 should be a year of economic growth

The financial rating agency Fitch Ratings estimates that Macau’s economy will grow 48 percent this year. The forecast was made public on Friday, through a statement.

This growth in Gross Domestic Product (GDP) is forecast after last year’s economy contracted by 26.8 percent. The decline in the economy in 2022 was due to the gaming sector, which saw a 51.4 percent drop in gross revenues to 42.2 billion patacas.

The trend is justified on the strength of the casino industry, which Fitch expects to reach about 50 percent of the 2019 figure, or gross revenues of around MOP 146.3 billion. “The removal of pandemic control measures and the return of Mainland tourist tours, as well as the end of labor limits and supply capacity restrictions that will effectively increase visitor numbers in 2023,” it is explained.

“Macau is well situated to receive the strong demand from Mainland tourists, as it is the only jurisdiction that allows visitors to play in Greater China, as well as taking advantage of its proximity to the Mainland,” it was added.

Lower deficit

Regarding the MSAR’s budget deficit, Fitch Ratings believes it will see a decrease to 10.5 percent of Gross Domestic Product by 2023. The figure represents an improvement in spending over last year, when the deficit was 35.5 percent of GDP.

“We believe that the strength of Macau’s public finances remains largely intact, despite the deficit record for the fourth consecutive year,” it was reckoned. “The deficit reduction for this year will reflect the increase in gaming revenues and the impact of relief from the lifting of pandemic-related measures,” it was added.

However, the deficit is expected to remain even for five years, until 2024, when Fitch Ratings believes it will be 1.9 percent. Despite the deficit, the agency maintained Macau’s rating at ‘AA’, the third highest level on the agency’s scale, stressing that it is the only jurisdiction worldwide without any foreign debt, besides having a financial reserve of 559.2 billion patacas.

Source: hojemacau