The development of the gaming sector in Macau has made the city’s economy “unbalanced”, with the diversification away from the industry being an imperative from Chinese central authorities and a directive “backed by most of the population”, says Sam Hou Fai, the sole official candidate for the next Chief Executive of Macau.
Sam Hou Fai, former President of the Macau SAR’s Court of Final Appeal, today officialized his candidacy for the gaming hub’s top political role and for the first time made public comments about his plans as possible leader of the city.
Current Chief Executive Ho Iat Seng indicated last week that he will not be running for a second five-year mandate due to unspecified health issues, with Sam the only candidate for the top position to surface so far.
During an almost hour-long press conference, Sam made very few direct mentions to the city’s main industry, maintaining the stance by the previous administration of almost solely addressing the city’s “entertainment and tourism industries” and underlining the need for the city to wean itself off what has been its main economic engine for decades.
“I have been in Macau for almost 20 years and have witnessed its evolution. The economic structure today is very different than before. In the 60s and 70s the industry led by Stanley Ho and STDM developed alongside the growth of the population, tourism, and entertainment”, the candidate mentioned.
“After the establishment of the RAEM, the motherland developed at a rapid pace, and the gaming sector also experienced new liberalization starting in 2000, leading to further growth.”
However, Sam stated that at one point the development of the gaming industry “became unbalanced”, occupying many human resources in the local society and “negatively impacting the mindset of younger generations in their job search”. Therefore, he concluded that diversification is of utmost importance.
The candidate recalled that during his visit to Macau some years ago, the Director of Hong Kong and Macau Affairs, Xia Baolong, stated that promoting the diversified development of Macau’s economy was a crucial direction for the SAR.
“Economic diversification is a mandatory issue, it is a directive of the central government and the will of the population!”
Sam Hou Fai
In his opinion, “no matter how difficult it is,” the general diversification directive holds great significance for solving the purported deep-rooted problems of Macau and needs to be addressed.
“If we don’t do it, we will lose the dynamism in the economic development of society”, he noted.
Despite Macau being focused on “diversification” even before the pandemic, the reality of the situation is hard to defy, with other industries in Macau finding it difficult to keep up with the generous contributions that gross gaming revenues have been contributing over the years, in particular to government coffers.
Macau’s gross gaming revenue (GGR) surged by 36.7 percent year-on-year to MOP132.2 billion ($16.4 billion) between January and July of this year, about 76.1 percent of the same period in 2019.
Meanwhile, the city’s gross domestic product (GDP) grew by 15.7 percent year-on-year in real terms during the first half of 2024, reaching MOP204.3 billion ($25.4 billion). This figure surpassed the MOP200 billion level ($24.9 billion) for the first time since the first half of 2019.
For the candidate, Macau experienced a severe impact from the three years of the pandemic, which he considers made various sectors of society and the general population gain a deeper understanding of the urgency for appropriate economic diversification.
“The impact of the epidemic on Macau’s economy has not yet been fully resolved, with ongoing issues related to insufficient and unbalanced economic recovery for small and medium-sized enterprises and the living conditions of the population,” he added.
“These phenomena result from various factors, such as changes in local consumer spending, shifts in visitors’ consumption patterns, external economic stagnation, and high interest rates on capital, all of which present challenges to overcome.”
Sam added that himself and his candidacy team will study how to support small and medium-sized enterprises in their innovation, transformation, and evolution, as well as how to activate the vitality of the community economy.
