The University of Macau expects GDP to rise in 2025

Macau’s gross domestic product is expected to increase by 7.7 per cent this year.

Macau.- The University of Macau (UM) has released a report in which it suggests that Macau’s gross domestic product (GDP) could grow by 7.7 per cent this year, despite global economic uncertainties.

The report also forecasts a 7.6 per cent hike in exports of services and a 3.1 per cent rise in private consumption expenditure. The inflation rate is expected to remain low at 1.1 per cent, while the overall unemployment rate could be 1.8 per cent, with the unemployment rate for locals at 2.3 per cent.

As for the government’s revenue, analysts forecast it could reach MOP111.8bn (US$14bn) mainly due to a stabilisation of the economy after the Covid-19 pandemic that deeply affected the city.

In the first nine months of 2024, Macau’s GDP was up 11.5 per cent in year-on-year terms at MOP301.0bn (US$37.4bn). It was the first time since 2019 that January-to-October GDP surpassed MOP300bn. 

Exports of gaming services rose by 28.4 per cent. However, exports of other tourism-related services declined by 6.1 per cent due to the high comparison base in the same period last year. Exports and imports of goods fell by 15.1 per cent and 8.3 per cent respectively.

In the third quarter, GDP was up 4.7 per cent year-on-year and reached 87.3 per cent of the third-quarter 2019 level. The growth was mainly driven by an 11.2 per cent rise in gaming-related exports. Exports of services rose by 1.3 per cent year-on-year while exports of other tourism services fell by 14.5 per cent. The implicit deflator of GDP, which measures overall price changes, increased by 1.5 per cent to 106.7.

Last October, the International Monetary Fund (IMF) lowered its growth forecast for Macau’s GDP for 2024 from 13.9 per cent to 10.6 per cent. For 2025, the IMF has adjusted the growth projection from 9.6 per cent to 7.3 per cent. According to the IMF forecast, the GDP will return to pre-pandemic levels this year. It also predicted that inflation will stay low, with consumer prices rising by 1.1 per cent this year, with unemployment at 1.8 per cent.

Macau visitor arrivals up 23.6% in 2024

34.93 million people visited Macau in 2024. The figure was up 23.6 per cent in year-on-year terms. Mainland Chinese tourists accounted for the majority of arrivals at 24.48 million. That’s a rise of 28.6 per cent year-on-year. The growth was mainly attributed to the expansion of mainland China’s individual travel scheme for Hong Kong and Macau.

Macau’s border crossings recorded a total of approximately 210 million entries and exits throughout the year, up 17.5 per cent year-on-year. Additionally, single-day peak traffic volumes at all Macau border points, as well as at the Hong Kong-Zhuhai-Macau Bridge and Hengqin Port, also reached record levels.

Citigroup forecasts strong start for Macau GGR in 2025

Citigroup projected that Macau’s gross gaming revenue (GGR) for January will reach MOP19bn (US$2.38bn), averaging MOP613m (US$76.7m) per day. The figure would be 76 per cent of 2019 levels.

Although GGR for January alone would be down 2 per cent year-on-year, analyst George Choi said that GGR for January and February combined could reach MOP40bn (US$5.01bn). That’s a rise of 6 per cent year-on-year.

Citigroup said that its forecast “neutralises the impact of the timing of Chinese New Year” and Golden Week that will take place from January 28 to February 4. Analysts further said the January projection also reflected a slower travel period leading up to Chinese New Year, which usually happens about two weeks before Golden Week.

Choi explained that the expected 2 per cent decline in year-on-year terms for January is due to the timing of the Spring Festival travel rush, a time that is typically quieter for Macau.

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