Macau economy, strong rebound in 2024 on tourism and gaming

 

Macau's economy shows significant signs of recovery in 2024, with the region's gross domestic product (GDP) reaching 204.3 billion MOPs ($25.5 billion) in the first half of the year. This represents a substantial 15.7% year-over-year growth, with the overall economy recovering to 86.2% of pre-pandemic levels from the same period in 2019. Notably, Macau's GDP has topped 200 billion MOPs for the first time since the pandemic, signaling a strong rebound.

Growth from tourism and gaming services:

According to the Inside Asian Gaming report, Macau Statistical Census Services (DSEC) sees this economic resurgence primarily as a significant increase in visitor arrivals and a corresponding increase in tourism activities. The influx of tourists has led to continued growth in service exports, which are an important component of Macau's economy. In particular, exports of gaming services increased 39.9% year-over-year, while exports of other tourism-related services increased slightly by 2.8%. What is impressive is that both categories exceeded the level of more than 20% from the first half of 2019, reflecting a strong recovery for key sectors in the region.

DSEC highlighted that service exports accounted for 81.8% of Macau's GDP at current prices in the first half of 2024, totaling nearly 167.03 billion MOPs (US$20.8 billion). This marks the first time since early 2019 that service exports have taken such a large part in the economy, highlighting the pivotal role of tourism and gaming in driving economic growth.

Macao's economic revival was also reflected in the increase in residents' income, propelling private consumption growth. During the first half of 2024, private consumption expenditure was up 7.8% year-on-year. Within this, household final consumption expenditure in the local market was up 7.0%, while external expenditure was up 13.5%. These figures indicate that local and overseas spending contributed to the economic rise, driven by higher household income and higher consumer confidence.

According to the Asia Gaming Brief, Macau's GDP in the second quarter of 2024 grew at a rather slow pace, with real growth of 6.9% year-over-year. The overall economy in the quarter represents 85.2% of the same period in 2019. During this period, service exports, which remain the cornerstone of Macau's economy, grew 6.1% year-over-year. In particular, gaming services exports rose 22.6% despite a 9.5% decline in other tourism services exports, indicating concerns for the broader tourism sector.

Prospects for 2024 and beyond:

Macau's gross gaming revenue (GGR) also rose 36.7% year-over-year to 132.2 billion MOPs ($16.4 billion) in the January-July period of 2024. The strong performance of these gaming revenues is a testament to the recovery of the sector, which has been central to Macau's economic revival.

Going forward, CLSA analysts forecast Macau casino GGR could reach $232.7 billion ($28.6 billion) in 2024, up 27% year-on-year. However, the brokerage slightly lowered its 2024 GGR estimate by 3% given that the second quarter of 2024 reported by Macau casino regulators is down 1.6% from the first quarter. The downward revision was partly due to a dampening of gaming revenue due to China's crackdown on illegal currency exchange. 안전한 카지노사이트

Despite these challenges, Macau's overall economic outlook remains positive, buoyed by continued recovery in tourism and gaming services. As the region continues to navigate post-pandemic challenges, growth in GDP and services exports provides a solid foundation for future economic stability and expansion.