However, GDP won’t return to its pre-COVID level until 2025 as a result of economic losses accrued during the pandemic. Macau’s GDP was US$24.33 billion in 2020, down 55.9% from US$55.15 billion in 2019.

In a concluding statement following consultation on Macau’s Macroeconomic and Financial Assessments, published this week, the IMF said Macau’s economy is estimated to have grown by around 17% in 2021 and will continue to recover in the next two years, with 15% GDP growth in 2022 to be followed by 23% growth in 2023 before gradually converging to its long‑term potential of around 3.5% over the medium term.

In the longer-term, however, the pandemic has exposed Macau’s over-reliance on the gaming industry.
“Although the strong fiscal support and the financial strength of Macau SAR’s casino groups cushioned employment and consumption, the sharp decline in activity exposed Macau SAR’s vulnerabilities to external forces affecting the inflow of tourists,” it said.

“The crisis brought Macao SAR’s overreliance on the gaming sector into sharp relief. The gaming sector – the key growth driver in the past two decades – almost came to a stop as tourist flows dried up.

“Despite the strong fiscal support and the financial strength of casino groups cushioning employment and consumption, aggregate GDP shrank by 54 percent in 2020, mostly on the collapse of services exports. This highlights the vulnerability of Macao SAR’s economy to external forces affecting the inflow of tourists, such as travel restrictions related to the pandemic.”

The IMF added that a “re-intensification” of the COVID-19 pandemic remains a short-term risk, highlighting the need to diversify the economy beyond the gaming industry.

“The high exposure to climate-related shocks poses long-term concerns,” it said.