Fitch Ratings predicts 48% rebound in Macau economy in 2023

Gross gaming revenue is expected to recover to about half of its 2019 level.

Macau.- Fitch Ratings has forecast a 48 per cent economic rebound for Macau in 2023, following a contraction in 2022 due to Covid-19 restrictions. The rating agency attributed the recovery to the city’s gross gaming revenue (GGR), which could recover to “about half of the 2019 level” this year. 

According to analysts, due to its geographic proximity to mainland China and its status as the only legal gaming tourism destination for Chinese gamblers, Macau is well situated to capture pent-up mainland demand. They expect the mass-market segment to continue to drive gaming revenue this year.

See also: Macau mass market gaming revenue expected to be up 200% for Q1

Macau recorded a budget deficit for the fourth consecutive year in 2022. The deficit is expected to decline from 35.5 per cent of GDP last year to 10.5 per cent in 2023. According to Fitch Ratings, public finances remain strong, with a narrower deficit expected due to an increase in gaming revenue and the removal of pandemic relief measures.

Fitch believes that Macau will maintain its large net external creditor position, at 262 per cent of GDP in 2023. Sovereign net foreign assets are projected to stay significantly above the median of its peers, at approximately 297 per cent of GDP.

As for Beijing’s order to diversify the economy away from gambling, Fitch expects a slow pace due to human capital constraints and skill gaps. Macau’s six casino operators pledged early this year an aggregate investment of MOP118.8bn in non-gaming entertainment and family-friendly attractions. However, Fitch believes non-gaming developments will take time to materialise. 

Macau sees highest daily visitor tally since start of Covid-19 pandemic

The Macao Government Tourism Office (MGTO) has reported that the city received 96,000 visitors on March 18. That’s the highest daily count of inbound visitors since the start of the Covid-19 pandemic in 2020.

The average daily inbound visitor volume from March 1 to 22 was approximately 65,000, a 13.4 per cent increase on February’s daily average. In January and February combined, Macau registered almost 3 million inbound visitors, following the lifting of most Covid-19-related countermeasures in mainland China, Hong Kong, and Macau.