Macau’s lagging base mass segment should receive a welcome boost in the coming months on the back of a newly announced China policy plan aimed at increasing incomes and providing support in light of increasing US tariffs on Chinese goods, a latest report from Seaport Research partners suggests.
In the Wednesday note, Seaport’s Vitaly Umansky points out that while Macau’s broader mass gaming segment has been strong post-COVID, this has been driven by premium mass where GGR is running at around 40% higher than 2019 levels. However, bass mass continues to lag – still 15% lower than in 2019 – with GGR generated from overnight stays even weaker given that day-tripper business from Guangdong and Hong Kong has been stronger than destination base mass.
Despite this, there remains reason for optimism following China’s annual Two Sessions in Beijing, where the new economic policy plan was outlined to further support initial stimulus measures announced in late September and ongoing support being provided to shore up the property market.
The document published earlier this week, titled “Special Action Plan for Boosting Consumption”, was jointly issued by the General Office of the Communist Party of the China Central Committee and by the General Office of the State Council and comprises a number of key elements.
They include promoting income growth for the population by implementing employment support programs, providing skills training, raising the minimum wage, expanding labor compensation, and stabilizing the stock market and property market; enhancing consumption demand by offering subsidies around childbirth, childcare, education, healthcare and elderly care; further consumption support for daily conveniences, cultural, sports and tourism; and more.
“While the tariffs and retaliatory measures remain an overhang, we expect China’s focus on shoring up the economy and providing further stimulus to improve economic activity and consumer confidence in China in 2025 with the obvious goal of improving domestic consumption,” Umansky wrote.
“With an increasing tariff regime in the US, we expect China policymakers to more forcefully look at expanding consumption and improving domestic consumer confidence which the latest set of actions highlights. Such policy initiatives should have a positive tailwind to Macau revenues.
“Our view on China economic improvement and corresponding uplift in consumer sentiment could lead to stronger base mass recovery (with continued premium growth) in 2025 and into 2026.”
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