In a report released on the 28th, Moody’s Investors Service stated that “Macau’s growth outlook could benefit from faster progress toward economic diversification than currently anticipated.”
For decades, the region – the world’s gambling capital – has been trying to reduce its dependence on casinos, focusing, among other sectors, on financial services between China and Portuguese-speaking countries.
The economic contribution of gambling accounted for nearly half of Macau’s total Gross Domestic Product in 2025. If tourism is added to casinos, then this sector accounts for 74.1% of the local economy, according to official data.
Moody’s argued that the “high dependence on a single sector” creates “significant volatility in growth,” particularly because the casino business may “gradually decline alongside weaker economic growth in mainland China over the long term.”
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The agency also noted that economic diversification faces obstacles, including a “shortage of skilled labor” and Macau’s demographic challenges related to an aging population.
Unemployment stood at 1.7% at the end of February, while the fertility rate fell again last year to a new historic low, after the Chinese region recorded the world’s lowest rate in 2024.
Moody’s maintained the region’s rating at ‘Aa3’, the fourth-highest level, and upgraded the outlook from ‘negative’ to ‘stable,’ the Macau Monetary Authority (AMCM) noted in a statement.
Moody’s noted that Macau is the only jurisdiction with no external debt and that, as of the end of January, it held financial reserves totaling 673.8 billion patacas (72.2 billion euros).
In addition, the AMCM highlighted “the close economic ties” between Macau and mainland China, where “macroeconomic strength and sound public finances” have demonstrated “high resilience in the face of external shocks.”
However, Moody’s identified “an intensification of political and institutional ties” with mainland China as a risk to Macau’s rating.
This would “likely reduce the effectiveness of economic or fiscal policies in Macau and could also lead to a downgrade” of the region’s rating, the agency explained.
