The Macau economy is expected to contract by 4.0 percent in 2015 and return to positive growth in 2016 with a rate of 8.0 percent, after ending 2014 with growth of just 0.7 percent, according to forecasts from the Economist Intelligence Unit (EIU).
The EIU analysts explain this year’s low economic growth and the fall in Gross Domestic Product in 2015 with the anti-corruption campaign launched by the Chinese government, which has led to gross casino gaming revenue to fall for six consecutive months.
The EIU expects the anti-corruption campaign will continue in 2015/2016 but said that revenue from casinos would tend to stabilise in mid 2015, before returning to growth, probably in the final quarter of the year.
Due to lower revenues slight delays are expected in the construction of three major hotel and gaming projects in the Cotai, an area of reclaimed land between the islands of Coloane and Taipa, despite the schedule for opening still expected to be in 2016.
Therefore, the EIU analysts predict that the gross fixed capital formation or investment will fall 9.8 percent in 2015, after a growth at the rate of 22.0 percent this year, before returning to growth of 7.0 percent in 2016.
The inflation rate will follow this downward movement of the economy and should fall from a forecast of 6.1 percent this year to 4.3 percent in 2015, and go up again in 2016 to 5.0 percent.
(macaunews/macauhub)
