U.S. markets closed

Macau Economy Shrinks by Most Since 2016 as Casino Revenue Falls

Jeanny Yu and Stephen Tan

(Bloomberg) -- Terms of Trade is a daily newsletter that untangles a world threatened by trade wars. Sign up here. 

Macau’s economy contracted by the most in almost four years in the fourth quarter, even before the coronavirus outbreak forced its casinos to shut down for about two weeks.

The city’s gross domestic product fell 8.1% in the fourth quarter from a year earlier, the most since the first three months of 2016. That was almost double the revised 4.4% decline in the previous three months, as revenue from casinos slumped 8.4%. The city’s economy shrank 4.7% in 2019.

The city closed its borders with China and ordered casino operators to shut down for 15 days earlier this month as it took precautions against the coronavirus outbreak centered in Wuhan. Macau has reopened the casinos but maintained limits on individual travelers and group tours from the mainland, which account for about 70% of visitors from China.

Macau Gaming Revenue Seen Plunging by Record 90% on Virus: Chart

Galaxy Entertainment Group’s Deputy Chairman Francis Lui said this week that the impact of the virus “won’t be small.” He said he expects construction of the company’s new casinos in Macau will be slowed by the virus outbreak. Macau’s monthly gaming revenue, scheduled to be announced Sunday, is expected to decline by a record in February because of the disruptions.

To contact the reporters on this story: Jeanny Yu in Hong Kong at jyu107@bloomberg.net;Stephen Tan in Hong Kong at ztan39@bloomberg.net

To contact the editors responsible for this story: Fion Li at fli59@bloomberg.net, Stanley James, James Poole

For more articles like this, please visit us at bloomberg.com

Subscribe now to stay ahead with the most trusted business news source.

©2020 Bloomberg L.P.