Sam Hou Fai

mar25

Macau’s Chief Executive, Sam Hou Fai, has warned that the city’s fiscal revenue for 2025 may fall short of earlier expectations due to a sluggish start for the gaming industry.

Speaking at a recent briefing following China’s “Two Sessions” meetings, the official acknowledged the economic challenges facing Macau and underscored the need for significant development projects to drive future growth.

The government did not specify how much lower the revised revenue forecast might be. Earlier projections estimated Macau’s gross gaming revenue (GGR) for 2025 at MOP240 billion ($29.7 billion), an increase of about 11 percent from the 2024 budget forecast of MOP216 billion.

The 2025 projection assumed an average monthly GGR of MOP20 billion ($2.5 billion) and estimated full-year gaming tax revenue at MOP93.1 billion ($11.64 billion). However, January’s GGR of MOP18.25 billion ($2.28 billion) and February’s MOP19.74 billion ($2.47 billion) both fell short of these expectations.

As reported by AGB, investment bank UBS has forecasted that Macau’s gaming industry will experience low single-digit growth over the next few years, with total GGR projected to increase by 3 percent year-on-year through 2025 and 2026.

UBS highlights that this growth will be primarily driven by the mass market, particularly the premium mass segment, which is expected to benefit from new hotel room supply and increased tourism initiatives. The mass gaming segment is projected to grow by 3 percent annually for both 2025 and 2026.

According to forecasts from the Macao Government Tourism Office (MGTO), visitor arrivals in 2025 are expected to reach between 38 million and 39 million, approaching 2019’s pre-pandemic levels. Macau recorded 34.93 million visitor arrivals in 2024.

Structural challenges

In the same briefing, Sam acknowledged that Macau continues to face internal economic challenges, including structural issues and shifting consumption patterns. He warned that the post-pandemic recovery momentum has slowed, making fiscal revenue growth less positive than initially projected. He stressed the need to carefully assess economic trends and address internal imbalances to mitigate potential risks.

During the first plenary session of the 2025 Economic Development Commission last month, Sam admitted that Macau’s heavy reliance on the gaming industry remains a significant obstacle to economic diversification. This marked the first time the Chief Executive publicly addressed this concern, emphasizing the urgency for change.

Since taking office in December, Sam has been meeting with major associations in Macau to gather public opinions ahead of his first policy address next month. Discussions are ongoing regarding potential measures to support the city’s uneven economic recovery.

Economic diversification 

To counter the potential negative impacts of economic restructuring, the top official pledged to adopt a more innovative mindset and implement stronger, practical measures to accelerate diversification. Efforts will focus on improving the business environment, fostering emerging industries, and enhancing community economic vitality.

Support for small and medium-sized enterprises (SMEs) will also be prioritized to strengthen their role in the local economy. Looking ahead, Sam emphasized the need for collaboration with various sectors to identify and develop landmark projects with significant economic impact, aiming to inject fresh momentum into Macau’s long-term growth.

https://agbrief.com/news/macau/16/03/2025/macaus-chief-executive-warns-of-potential-revenue-shortfall-amid-slow-gaming-start-in-2025/?utm_source=Asia+Gaming+Brief&utm_campaign=c7741c7551-AGB%3A+%2302102+Monday%2C+17th+March%2C+2025&utm_medium=email&utm_term=0_51950b5d21-c7741c7551-%5BLIST_EMAIL_ID%5D&ct=t%28AGB%3A+%2302102+Monday%2C+17th+March%2C+2025%29&goal=0_51950b5d21-c7741c7551-%5BLIST_EMAIL_ID%5D&mc_cid=c7741c7551&mc_eid=31e20475e6

 out24  (Risk analyst predicts tough times for casinos)

A top Hong Kong-based security consultancy predicts Macao’s incoming government will intensify the push for economic diversification at the expense of foreign-owned gaming concessionaires, their investors and the myriad of downstream businesses reliant on the gaming industry in the SAR.

Steve Vickers Associates (SVA) issued a memo on Monday recommending that boards and executives with investments in Macao (as well as Hong Kong and the mainland) stay alert to growing risks associated with state intervention and measures introduced to prevent capital flight. SVA urged potentially impacted companies to “anticipate threats” in order to mitigate any potential losses.

The firm claimed that Macao’s newly-elected chief executive designate, Sam Hou Fai, would “likely expedite measures forcing the six casino concessionaires to diversify and contribute more to social causes” in response to policy pressures from Beijing. 

https://macaonews.org/news/business/macau-risk-assessment-steve-vickers-associates-macao-sam-hou-fai/

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