Francis Tam revealed yesterday that gaming revenue in October has dropped by more than 20 percent compared to the same period in 2013. The Secretary of Economy and Finance also said continuation of the annual cash handout in 2015 can be expected if the level of government income this year is similar to that of 2013.
Mr Tam said on the sidelines of the Luso International Bank 40th anniversary celebration yesterday that the monthly gross gaming revenue in October fell by more than 20 percent. “The October gaming revenue, as we have previously mentioned, will continue to fall. The rate at which revenue is decreasing is also close to the market expectation… Since tomorrow [today] is a working day, the October figure will be published tomorrow. The rate of decrease will exceed 20 percent. Although it has already dropped for the fifth consecutive month, we still predict the slowdown of gaming revenue growth will continue for a period of time,” he said.
According to the Gaming Inspection and Coordination Bureau (DICJ), the gross gaming revenue in October 2013 was MOP36.4 billion.
However, the Secretary added that this downward trend does not affect the government revenue this year and the 2014 revenue will be similar to that of 2013. “After all, the gaming revenue this year is on the same level as last year,” he said.
Moreover, Mr Tam revealed that the administration has finished initial preparations of the 2015 budget and has adopted a cautious approach when it comes to government revenue next year. “We still expect that the budget revenue next year will be similar to this year,” he said.
When asked whether public departments will have to adjust their budget and reduce expenses, Francis Tam said that the government has to cut costs on items that are deemed expensive. However, he pointed out that Macau residents are demanding more services from the government. “It is indeed difficult if we want to drastically reduce public spending on social welfare and spending on items relating to the daily life of residents, especially when the economic situation is volatile. Of course, as the Chief Executive has said, we must handle the government’s administrative expenses prudently,” he said. Mr Tam added that the government will have to be more austere in its administrative expenses.
In terms of annual cash handouts, the Secretary did not indicate clearly whether or not there is the chance that the administration will halt the scheme. Instead, he listed several conditions that have to be fulfilled for it to continue. “If the public revenue this year stays on the same level as last year, while the budget revenue of 2015 is consistent with this year’s budget… if people think that the public revenue in these recent years is not going to see a significant fall… then I think it is normal [to expect the cash handout to continue],” he said.
He said that the Chief Executive will reveal more details regarding the cash handout scheme when he attends the Legislative Assembly (AL) on November 11.
Concerning the wage adjustment of public servants, Francis Tam insisted that there are many factors to consider when deciding whether to increase the wages of public servants. “Sometimes, you cannot only focus on the one-off decrease of government revenue when considering wage increase [for public servants]. There has to be a comprehensive deliberation,” he stated.
AMCM head vows diversified investments
The chairman of the Monetary Authority of Macau (AMCM), Anselmo Teng Lin Seng, said that investment of the government reserves will become more diversified. “In terms of the [investment into] financial products and currencies, it will be more diversified and will be able to be distributed more evenly. This can balance the risk and gain better return,” he said.
Mr Teng also mentioned the authority’s plan to set up a sovereign wealth fund, which was also proposed in the election platform of the Chief Executive Chui Sai On in August. He said that the fund is a precautious measure that seeks to improve the management of government reserves. Mr Teng said that the government may commission some fund managers to help manage the future sovereign fund.
The chairman said that the government will reveal more information about the establishment of the sovereign fund in the future.
In addition to this, Mr Teng gave a speech during the Luso International Bank 40th anniversary ceremony yesterday. He has described Macau’s current financial sector to be at its most successful in history.
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