China’s economy has demonstrated resilience, posting a robust 5.4 percent year-on-year growth in its first-quarter Gross Domestic Product (GDP), exceeding the anticipated 5.2 percent.
This figure signals a strong start to the year for the world’s second-largest economy, despite the ongoing headwinds from international trade tensions.
Macau’s gaming revenue highly depends on Chinese tourist spending, with over 70 percent of visitor arrivals coming from mainland China. In the recent policy address, Macau’s top leader Sam Hou Fai noted that the city needs to be aware of external challenges, including the rising tensions between China and the US, as well as softening consumption.
He also mentioned that Macau may have a deficit budget when the Macau gaming revenue is lower at MOP15 billion ($1.88 billion) per month.
In an analysis by Xu Changtai, Morgan Stanley’s Chief Asia-Pacific Strategist, he described the the first quarter GDP growth as a “modestly positive indicator,” suggesting that the Chinese economy has entered the new year with significant momentum.
Adding to the positive economic signals, China’s retail sales data for March also outperformed expectations, increasing by 5.9 percent, well above the projected 4.3 percent. Analysts noted that this likely reflects, at least in part, the government’s efforts to stimulate spending.
This positive trend could encourage policymakers to continue exploring further measures to boost consumer expenditure, potentially with a focus on the services sector.
However, analysts also highlighted a notable surge in industrial production, which jumped by 7.7 percent, significantly higher than the 5.9 percent forecast. This could be attributed to overseas orders being placed ahead of potential further US tariffs.
Meanwhile, in a parallel move to bolster domestic consumption, nine Chinese government departments, including the Ministry of Commerce, jointly issued the “Action Plan to Improve and Promote Service Consumption.”
This comprehensive plan outlines 48 specific measures, which cover major service industries such as dining, hospitality, healthcare, culture, tourism, and sports, and also encompass emerging trends like tourist trains and aerial tours. The Ministry of Commerce emphasized that the action plan aims to unlock the vast potential of service consumption, providing strong support for high-quality economic development.
