Macau’s gross domestic product (GDP) increased by 4.0 percent year-on-year in real terms for the three months to September 30, said on Tuesday the city’s Statistics and Census Service. It was the first such quarterly year-on-year rise since the second quarter of 2014 – when the city’s economy expanded by 5.7 percent.
The statistics bureau said the local economy’s growth in the third quarter was mainly due to increases in exports of services and in investment. Gaming services in Macau are included in exports when calculating the city’s GDP. That is in order to reflect spending by tourists in the city’s casinos.
In the July to September period, exports of gaming services went up by 0.2 percent year-on-year in real terms.
Macau’s GDP performance trends in recent years have coincided with casino gross gaming revenue (GGR) trends in the city, highlighting the importance of the gaming sector to the local economy. The gaming business was negatively affected by a slump in GGR that began in the third quarter of 2014 and extended for two years. Casino GGR in Macau posted its first increase in the third quarter of 2016: it went up by 1.2 percent in year-on-year terms.
Investment analysts covering the sector have attributed the GGR decline recorded in Macau between mid-2014 and mid-2016 to several factors, including the ongoing anti-corruption drive in mainland China; a slowdown in the Chinese economy; and increased scrutiny by the Macau government focused on the city’s casino junket system.
Also helping Macau’s GDP performance in the third quarter of 2016 was the construction of several casino resorts on Cotai. Two new large-scale properties – Wynn Palace and Parisian Macao – opened during the July to September quarter.
In the first nine months of 2016, Macau’s economy contracted by 5.4 percent year-on-year in real terms, according to Tuesday’s data.
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”We have been given reason to have confidence that that our businesses [in Macau] will continue after the initial concession expiration date”
Chairman and chief executive of Wynn Macau