Macau’s economic future is looking brighter than ever, with 59% growth expected in the coming years. With the right investments and policies, Macau can enjoy a steady stream of income and a secure financial future. 

The growth of Macau, a special administrative region of China, will be the second-fastest in the world over forecast horizons. This, however, is more a result of a base effect following one of the world’s steepest pandemic-related downturns than a strong growth outlook. As Macau depends heavily on tourism and gambling for its economy, China’s zero-tolerance Covid-19 policy has devastated its economy. Growth projections depend on a subsequent rebound in foreign visitor arrivals and a easing of China’s Covid-19 stance. The country is heavily dependent on one industry – gambling – and on mainland visitors. How has Macau overcome this notable risk? We dive deep into Macau’s economic growth in this article. 

Macau’s economy is expected to grow by as much as 58.9 percent by 2023, according to the International Monetary Fund (IMF). Macau’s economy is expected to grow by as much as 58.9 percent by 2023, according to the International Monetary Fund (IMF). GDP growth is forecast to reach 20.6 percent in 2024, and 8.5 percent in 2025. GDP growth is forecast to reach 20.6 percent in 2024, and 8.5 percent in 2025.  

Three possible growth scenarios have been published by academics, with the lowest estimate of 20.5 percent GDP growth, to $26.2 billion, and the highest estimate of 44.1% growth. There was also a middle estimate of 36.5 percent growth, to $29.7 billion. 

Fitch Ratings also predicted a 46 percent rebound for Macau in 2023, following a 17 percent decline in 2022. 

According to the IMF economic forecast, unemployment will drop to 2.7 percent this year, while prices will only rise by 2.5 percent. The Macau Statistics and Census Service reported that Macau’s unemployment rate eased to 3.3 percent in the three months to February 2023, down from 3.4 percent in the previous period. The unemployment rate was the lowest since April 2022. 

Although officials expressed a desire to reach such levels of visitation as quickly as possible, analysts at UM do not expect tourist volumes to reach anywhere near the 40 million they welcomed pre-pandemic. 

Three consecutive years of COVID prevention restrictions resulted in a contraction of the local economy. Macau’s GDP declined by 26.8 percent in 2022. Visitors to Macau fell 26 percent year-on-year to 5.7 million in 2022. According to official figures, 2022 was the lowest year for visitor arrivals to Macau since 1999. This contrasted highly with the 39.4 million visitors who flocked to Macau in 2019, marking a record number of tourists. 

UM researchers assume a top estimate of 21.38 million tourists in 2023, with a strong second half-year spike in arrivals. 

As a best-case scenario, 3.11 million tourists would visit in the first quarter (30% of 2019’s level), 3.97 million in the second quarter (40% of 2019’s level), with a sharp rise in the third quarter to 6.94 million (70% of 2019’s level) and the final quarter to 7.36 million (80% of 2019’s level). 

During the year, the group projects just 10.75 million tourists – 2.07 million in 1Q23, 2.48 million in 2Q23, 2.98 million in 3Q23 and 3.22 million in 4Q23. Due to a lack of diversification in the city’s financial sector, tourism revenues will largely drive the city’s GDP. 

Despite only totaling MOP41.19 billion ($5.21 billion) for the whole year, Macau recorded its worst GGR year ever in 2022, a 51.4 percent decline. 

GGR figures for January were positive, aided by the Chinese New Year holiday falling entirely in the month. Revenues reached MOP11.58 billion ($1.43 billion), up 82.5 percent. The new 10-year gaming concessions, which came into effect on January 1st, provided an additional note of stability to Macau’s six gambling operators. 

Based on its cautious assumption that gaming revenue will recover to about half of what it was in 2019, ratings agency Fitch forecast Macau’s economy will rebound by 48 percent in 2023. According to analysts, the removal of pandemic control measures, as well as the resumption of mainland packaged tours will significantly boost visitation numbers for 2023. 

Macau’s Chief Executive previously praised the signing of the new licenses, noting that the six operators’ contributions, including their non-gaming investments, will accelerate Macau’s growth this year and in the future. 

According to the Macau Government Tourism Office, the city could reach 20 million visitors by the end of the year, based on about 5 million visitors in the first quarter. However, many industry experts predict that Macau’s recovery path will accelerate in the second half of the year, since Macau’s gross gaming revenue continues to improve despite ‘low season’ periods. 

Macau’s recovery remains dependent on a recovery in Chinese visitors, which EIU expects to materialize after mid-2023.Until beyond 2024, recurring outbreaks will keep gambling and tourism activity below pre-crisis levels. It is unlikely that worsening US-China ties will affect the renewal of casino licenses scheduled for end2022, including those for the three US-owned casinos in the territory. As US-China frictions intensify over the next decade, this risk will persist. 

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