Fitch Ratings has issued an optimistic update on how it sees Macao’s economic performance playing out through next year, forecasting 15 percent growth for 2024 and 8 percent for 2025.
The credit rating agency said it “anticipates solid economic expansion in Macao, albeit at a more moderate pace,” pointing to gaming tourism’s ongoing revival, expanded handling capacity and favourable policy initiatives as reasons for confidence. Stimulus measures recently unveiled by the central government would “most likely help to boost gambling revenue and consumer confidence,” it added.
The memo said that new visa rules letting eligible mainland Chinese tourists make multiple trips on group tours between Macao and Hengqin, where accommodation is cheaper, should also support growth in the gaming sector. It also noted that mainland visitors on business visas were now allowed to spend 14 days in the SAR, up from 7.
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However, Fitch Ratings also described Macao’s reliance on gaming tourists from the mainland as an economic weak point, making the city vulnerable to “policy shifts that may affect China’s treatment of gaming tourism.” That, along with Macao’s “narrow economic base,” constrained the firm’s forecast.
At the same time, Macao’s “exceptionally strong public and external finances” kept its AA long term issuer rating relevant, the memo said. Fitch Ratings acknowledged Macao’s government had demonstrated fiscal prudence even during periods of economic and gambling revenue shock.
The memo noted that the recent National Day holiday period saw average daily arrivals exceeding that of the same period in 2019, and that gross gaming revenue had returned to 77 percent of its pre-pandemic level.
