Analysts predict that Macau will experience a prosperous new year and further growth by 2026 as the city continues to recover from the effects of Covid-19. In December 2023, casinos in Macau reported a 2% decline in gross gaming revenue (GGR), totaling MOP18.2 billion (£1.813 billion/€2.184 billion/$2.27 billion). This decline marks the only monthly decrease since the city reopened in January 2023.
The drop in revenue was largely attributed to the three-day visit from Chinese President Xi Jinping, who was in the city from December 18 to December 20 to commemorate the 25th anniversary of Macau's return to Chinese sovereignty. During this visit, he also officiated the inauguration of the new chief executive, Sam Hou Fai, on December 20, who succeeded Ho Iat-Seng. Sam leads the sixth government of the special administrative region and is part of efforts to diversify its economy beyond gaming.
Experts are optimistic about the continued growth of Macau's gaming industry. Last year, GGR in the city increased by 23.9% to MOP226.78 billion, surpassing the official target of MOP216 billion and recovering approximately 78% of the MOP292.5 billion achieved in 2019. Jeffries analyst David Katz suggests that the industry might return to pre-pandemic levels, aided by policies aimed at enhancing consumer health.
Positive signs include rising tourism figures and a strengthened mass gaming sector. Macau anticipates welcoming 35 million visitors in 2025, representing a nearly 25% increase from the previous year. Approximately 70% of these visitors are expected to come from mainland China, buoyed by relaxed visa regulations that permit longer stays. There is also a growing interest from international tourists; last year saw over 2.4 million visitors from outside Asia, a 66% increase compared to the previous year. To attract more tourists, Macau is promoting non-gaming experiences, including sporting and cultural events, and will be featured at upcoming travel conventions like ITB Berlin, happening from March 4-6.
Fitch Ratings previously projected an 8% rise in Macau's gross domestic product (GDP) for 2025, supported by the recovery of the gaming tourism sector, expanded capacity, and favorable policies. The Macau Gaming Inspection and Coordination Bureau (DICJ) set the GGR target for this year at MOP240 billion. However, analysts from Citigroup noted that the DICJ often underestimates actual revenue. According to the Macau Daily Times, Citi analysts George Choi and Timothy Chau predicted a 7% year-over-year increase in GGR, estimating it could reach MOP244 billion. They also anticipate a 13% increase in earnings before interest, taxes, depreciation, and amortization (EBITDA) for 2025. Their team indicated that if historical trends persist, there could be significant upside to Citi's GGR forecast, particularly as advancements in smart tables enhance casinos' ability to track and analyze player behavior.
