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Government to plug MOP 35.6 billion budget deficit from extraordinary reserves

MOP 7 billion earmarked for 2023 wealth-sharing hand-out; education, old-age and similar subsidies maintained; Finance Secretary predicts 40,000 daily visitors.

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MOP 7 billion earmarked for 2023 wealth-sharing hand-out; education, old-age and similar subsidies maintained; Finance Secretary predicts 40,000 daily visitors.

ARTICLE BY

PUBLISHED

READING TIME

Less than 1 minute Minutes

UPDATED: 22 Dec 2023, 12:35 am

The government will allocate MOP 35.62 billion from the extraordinary reserves to plug a gap in the 2023 budget, the fourth consecutive year it has run a deficit.

The Legislative Assembly passed the outline of the government’s 2023 budget bill during yesterday’s plenary session.

Secretary for Economy and Finance Lei Wai Nong said that the government estimated next year’s gross gaming revenue would be around MOP 130 billion. Macao’s gaming operators pay up to 40 per cent of their GGR to the government as direct gaming tax and additional “contributions” to a host of public causes.

According to the bill, the government’s expenditure for next year is budgeted at MOP 104.4 billion, a year-on-year increase of MOP 4.9 billion, or five per cent more than the government’s 2022 budget.

Lei underlined that the special allocation for the Non-Mandatory Central Provident Fund will once again not be carried out because the government has been coping with a budget deficit since 2020.

Macao confirmed its first Covid-19 case in January 2020, after which the government began to spend large amounts of money to tackle the pandemic.

Due to the adverse impact of the pandemic on Macao’s economy and finances, the government has refrained from paying its special annual allocation of MOP 7,000 into residents’ Non-Mandatory Central Provident Fund accounts.

However, Lei said that the government will continue paying a raft of subsidies, benefits and allowances such as education fee allowances and various other allowances for the education sector, old-age pensions, disability pensions, and allowances for disadvantaged families.

Lei said that the government has earmarked MOP 7.1 billion for its annual wealth-sharing cash hand-out in 2023. This year, permanent residents received a MOP 10,000 hand-out, while non-resident residents got MOP 6,000. Lei did not specify how much each permanent and non-permanent resident will receive next year.

Lei said that in the first half of this year, the government had lost MOP 17.4 billion on its investments, with a return of minus 2.8 per cent.

Lei said that this was caused by the sharp fluctuations in the debt, stock and foreign exchange markets this year, with some major economies implementing tighter monetary policies in response to high inflation amid the uncertainty caused by the novel coronavirus pandemic, further leading to a sharp correction in global financial markets.

Lei also said the government would adopt a more conservative and prudent approach towards its investments, stressing that the Macao Monetary Authority was working hard to manage investments to “preserve Macao’s wallet”.

Lei said he believed that Macao’s economy will recover from the adverse impact caused by the Covid-19 pandemic, as the central government had resumed the electronic application procedures for mainlanders to apply for Individual Visit Scheme travel permits, as well as permits for mainlanders’ tour groups to visit Macao, initially from four provinces and one municipality, namely Fujian, Guangdong, Jiangsu and Zhejiang as well as Shanghai.

Lei also said he was confident that the city’s Covid-19 prevention and control measures would be more “precise and swift” following the severe outbreak of the virus last summer.

Lei said the government expects the average number of visitor arrivals to rise to 40,000 a day next year, thanks to the new arrangements of the central government.

Prior to the Covid-19 pandemic, Macao’s daily average of visitor arrivals reached nearly 100,000.

Lei pledged that the government would do its best to lower the negative impact caused by the impact of the Covid-19 pandemic on the local economy, The Macau Post Daily reported. 

 

UPDATED: 22 Dec 2023, 12:35 am

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