Moody’s keeps Macau long-term credit rating at Aa3
The ratings agency maintained the outlook of the Macau government as negative.
Macau.- Moody’s has maintained Macau’s long-term issuer rating at Aa3. The rating agency said that the decision was based on the city’s strong fiscal and external positions and the absence of outstanding government debt, providing significant capacity to withstand shocks.
The agency maintained the outlook of the Macau government as negative. “There are risks that Macau’s currently very large fiscal and external buffers may erode over time, should Macau’s growth prospects weaken, although from a very high base,” it said, noting that weaker economic activity in the gaming sector would lower government revenue and services exports, undermining fiscal and current account surpluses in the absence of mitigants.
The Macau Statistics and Census Service reported that gross domestic product (GDP) for the first quarter of the year was down 1.3 per cent year-on-year at MOP99.78bn (US$12.45bn). That’s 85.2 per cent of first-quarter 2019, before the Covid-19 pandemic.
Visitor arrivals rose by 11.1 per cent in the first quarter of the year, but exports of services decreased by 3.8 per cent in real terms due to a decline in other tourism services resulting from changes in visitor consumption patterns. In domestic demand, gross fixed capital formation, government final consumption expenditure and private consumption expenditure rose by 7.8 per cent, 1 per cent and 0.6 per cent respectively.
The Macau government collected MOP29.84bn (US$3.71bn) in taxes from casino operations in the first four months of the year, flat in year-on-year terms. The 2025 budget plan, which the Legislative Assembly approved in December, estimates that Macau’s casino GGR will reach MOP240bn (US$29.7bn) this year. Gaming taxes are expected to reach MOP93.12bn (US$11.6bn).
