Fitch Ratings has forecast more subdued economic growth of 6.9 percent for Macao this year, down from 8.8 percent in 2024. It also predicted that gross gaming revenue (GGR) will “rise more gradually” to around 81 percent of its pre-pandemic level in 2019.
The forecast was part of Tuesday’s rating commentary, which affirmed the SAR’s long-term foreign-currency issuer default rating at “AA” with a “stable outlook.”
The note said Fitch expected gross domestic product (GDP) would be supported by “continued, but slower, gaming tourism recovery, along with favourable visa policies for mainland visitors, non-gaming investments and enhanced tourism infrastructure.”
It said the rating primarily reflected Macao’s “exceptionally strong public and external finances” combined with “demonstrated prudent fiscal management even during periods of economic and gaming revenue shocks.”
[See more: How experts see the role of Macao’s bond market in diversifying the local economy]
Fitch also noted that Macao was its only rated jurisdiction without any outstanding government debt, and described this as a “considerable rating strength.” It said that most other AA-rated jurisdictions were projected to have a median general government debt-to-GDP ratio of 49 percent in 2025.
However, it added that any sharp slowdown in the mainland’s economy caused by, for example, “substantial US tariff hikes,” posed a risk to Macao’s prospects. Other risks included the SAR’s current lack of economic diversification and a reliance on gambling tourists from the mainland – leaving it vulnerable to policy shifts regarding gambling from the central government.
Fitch said that while it anticipated Chief Executive Sam Hou Fai to outline plans to “expedite diversification towards strategic non-gaming industries” in his upcoming policy address, human capital constraints and skill mismatches would likely remain key challenges to reducing Macao’s dependence on casinos in the near term.
“We expect Macao’s gaming dependence to persist,” the note stated.
