The possibility of commodity prices falling soon remains vague, president Samuel Tong Kai Chung of the Macau Institute of Management said.
He said the pressure is mostly from the upstream side.
In the past three years, he recalled, many local businesses have run special promotions or offered special prices to attract customers. With tourists returning, many of them have canceled these special prices, “so that people have the feeling of a price hike,” Tong said in an interview with local newspaper Macao Daily News.
On the other hand, prices have also increased at the sources, which equates to elevated costs on the retail side.
Another factor that exerts pressure on commodity prices is rents. After the resumption of normal travel, shop owners have become progressive on rental evaluations. When a lease is renewed, many business operators are faced with soaring rents.
The cycle will then return to the increase in tourist arrival figures, which inject greater confidence in businesses to increase prices.
Several lawmakers have asked the government to issue another round of consumption subsidies or an additional round of cash handouts, which will help alleviate the public’s livelihood pressure amid the resumption of normal travel.
In response, the government has only reiterated that it would examine the possibility of doing so.
On this matter, Tong agreed that residents are facing higher prices that eventually lead to greater livelihood pressure. He suggests the government closely monitor the quality of revivals and average household income to assist decisions on additional monetary subsidies.
MOP130b GGR will likely be achieved
With gross gambling revenue (GGR) reviving in March, Tong has reminded the public of the importance of economic diversification.
He added that the GGR figure for the first quarter is on par with the government’s estimate for this year at MOP130 billion.
The March GGR amounted to MOP12.7 billion and the first quarter to MOP34.6 billion. The first two months saw three million visitor arrivals, with 67% holding mainland travel endorsement and 30% holding Hong Kong ID documents.
If this indication persists, the GGR estimate for this year will likely be achieved, Tong told local newspaper Exmoo.
Despite the bright GGR figures, he reminded the public the government and the city are striving to expand their source market, hoping to attract more tourists from the non-Greater China Region. He said matching a widened offering of non-gambling products and elements with reinvigorating the GGR is more important than focusing too much on the GGR increment itself.
In addition, Tong warned a rising GGR, paired with a narrow source of tourists, is not a healthy path of development. The casino market is part of the economy the government wants to diversify, Tong explained.
Reviewing the past, he said society was overly focused on the casino industry, without seeing the entire picture. Explaining that the GGR should no longer be the only apparatus to measure economic performances, Tong suggested a set of systematic assessment apparatuses to compare government targets and the reality.
