The Gross Domestic Product of Macau (GDP) is expected to return to growth in 2017, the year in which the Economist Intelligence Unit (EIU) expects a rate of 5.2 per cent, which will rise one-tenth of a percentage point to 5.3 per cent in 2018 according to the latest report on the territory.
Macau’s economy contracted by 21.5 per cent in 2015 and should end this year with a fall of 3.5 per cent, after having contracted 5.4 per cent from January to September but grown 4.0 per cent in the third quarter.
Gross fixed capital formation, or investment, should continue to fall in 2017, with the EIU forecasting a contraction of 8.5 per cent before returning to growth the following year, albeit with a marginal increase of 0.5 per cent.
The EIU, according to the report to which Macauhub had access, said the rate of inflation should continue falling in 2017, with a rate of 1.5 per cent, before rising again by six-tenths of a percentage point over the forecast 2.3 per cent for this year.
The Macau government’s budget balance will remain relatively unchanged, with a value of 8.0 per cent of gross domestic product, compared with 10.0 per cent in 2015, which is expected to drop to 7.8 per cent in 2017 and 7.5 per cent in 2018.
The report notes the four consecutive months of rises in casino revenues adding that there are delays in some tourist developments due to falling revenues, but that the opening of the new Wynn Resorts hotel/casino suggests that that the remaining projects will remain on schedule.
Another issue is the drop in the so-called VIP segment, which the EIU attributed to the anti-corruption campaign in place in China, as well as the fact that the recovery in the gaming sector, Macau dominant industry, is based on the mass segment.