Fitch Ratings revealed a report where explains the dependence on gaming revenue will drive the city to a fall in economy.<\/p>\n\n\n\n\n\n\n\n
Macau.- Fitch Ratings<\/strong><\/em> has predicted a 24 per cent decline in the Macau economy, based on an estimated gross gaming revenue decrease of 40 per cent for the year due to the Coronavirus crisis.<\/p>\n\n\n\n The rating agency noted that the dependence on gaming tourism exposed the local economy to substantial disruptions from lockdown measures imposed to contain the Coronavirus pandemic.<\/p>\n\n\n\n “Macau\u2019s overwhelming dependence on gaming tourism constitutes one of its principal rating constraints. Macau is one of the world\u2019s biggest gaming tourism hubs and Fitch estimates the gaming industry represents 51 per cent of aggregate activity, 22 per cent of employment, and more than 80 per cent of fiscal revenue,” the agency explained.<\/p>\n\n\n\n Fitch also holds a negative sector outlook on the local banking system, believing that the global pandemic will result in pressure on banks\u2019 asset quality and profitability.<\/p>\n\n\n\n “The mainland China exposure (MCE) of Macau banks remains the single biggest financial-sector risk. The agency estimates Macau\u2019s MCE rose to 41 per cent of system assets by end-1H19, the highest in the Asia-Pacific region, and double its size at end-2015. <\/p>\n\n\n\n “A low impaired-loan ratio of less than 0.2 per cent with about 50 per cent of exposures backed by parental guarantees or guarantees from other mainland banks help mitigate the potential challenges,” Fitch added.<\/p>\n\n\n\n However, the agency said that Macau is well-placed to survive an economic downturn: <\/p>\n\n\n\n “Public finances remain robust, despite ongoing economic disruptions. The authorities recently unveiled a package of economic relief measures amounting to about MOP52.6billion, or 15.6 per cent of projected 2020 GDP, to cushion the economic impact of the pandemic.”<\/p>\n\n\n\n Fitch estimates this will result in the territory reporting its first budget deficit since the 1999 handover, at about 7 per cent of GDP this year, and forecasted that budget will revert to a surplus in 2021.<\/p>\n","protected":false},"excerpt":{"rendered":" Fitch Ratings revealed a report where explains the dependence on gaming revenue will drive the city to a fall in economy.<\/p>\n","protected":false},"author":2,"featured_media":3965,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"is_press_release":false,"is_interview":false,"is_opinion":false,"focusai_summary":"Fitch Ratings forecasts a 24% economic contraction in Macau, driven by an estimated 40% decline in Gross Gaming Revenue (GGR) due to the Coronavirus pandemic. The report highlights Macau's critical dependence on gaming tourism, which significantly impacts its economy, employment, and fiscal revenue, while also noting potential pressures on the local banking system's asset quality. Despite these challenges, Fitch acknowledges Macau's robust public finances and substantial economic relief measures, projecting a temporary budget deficit for 2020 before a return to surplus in 2021.","focusai_entities":"Fitch Ratings","focusai_location":"Macau, China, Asia-Pacific","focusai_target_profile":"ceo_executive (0.9), regulator (0.85), compliance_legal (0.7), operator_casino (0.95), payments_fraud_aml (0.75), investor_analyst (0.95), supplier_vendor (0.7), journalist_researcher (0.9)","focusai_suggestions":[{"label":"Macau GGR Recovery Timeline?","query":"What is Fitch Ratings' projected timeline for Macau's Gross Gaming Revenue (GGR) recovery, and what are the key indicators for this rebound?"},{"label":"Banking Sector Impact on Operators?","query":"How will the Macau banking sector's significant mainland China exposure and potential asset quality pressures impact credit availability and financing costs for gaming operators?"}],"footnotes":""},"categories":[160,161,16338,163,167,158],"tags":[257],"class_list":["post-5794","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-asia-pacific","category-daily-news","category-east-asia-news","category-finance-news","category-news-region","category-slider-home","tag-macau"],"_links":{"self":[{"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/posts\/5794","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/comments?post=5794"}],"version-history":[{"count":4,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/posts\/5794\/revisions"}],"predecessor-version":[{"id":777018381,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/posts\/5794\/revisions\/777018381"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/media\/3965"}],"wp:attachment":[{"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/media?parent=5794"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/categories?post=5794"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/focusgn.com\/asia-pacific\/wp-json\/wp\/v2\/tags?post=5794"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}